Semi-Annual Report 2022
For the Six-Month Period Ended 30th September 2022

PROFILE
Since its establishment in 1958, MARUDAI FOOD CO., LTD. has been dedicated tooffering delicious, high-quality meat products. In order to understand the latest
consumer trends and to meet the needs of modern lifestyles, we have continuously
strengthened our research, sales and production operations. Intending to become
Japan’s leading food company, we successfully listed our stock on the First Section of
the Tokyo Stock Exchange in 1972.
Starting as a ham and sausage producer, Marudai Food has steadily expanded its
range of products to include heat-processed, vacuum-packed food, dessert and beverage
products and fresh meats. Ham and sausage, however, remain an integral part of our
product line and continue to account for almost a third of our sales.
While pursuing a leading position in the ham and sausage market, Marudai Food waseager to explore new avenues by developing precooked and processed foods, which
went on sale in 1973. This long shelf-life food was developed to meet the specific needfor fast meal preparation. Containing absolutely no preservatives and requiring only
several minutes to prepare, Marudai precooked and processed foods have established astrong foothold in the market. Building on this success, we will make even greater
efforts to create new products that satisfy the increasingly discriminating tastes ofconsumers.

CONTENTSTO OUR SHAREHOLDERS .............................................................................. 1
PRODUCTS ......................................................................................................... 2
CONSOLIDATED BALANCE SHEETS ........................................................... 3
CONSOLIDATED STATEMENTS OF INCOME ............................................. 5
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME .......... 6
CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS ............ 7
CONSOLIDATED STATEMENTS OF CASH FLOWS .................................... 8
NOTE TO CONSOLIDATED FINANCIAL STATEMENTS ........................... 9
DIRECTORS AND STATUTORY AUDITORS .............................................. 10
OUTLINE OF THE COMPANY ...................................................................... 11b

MARUDAI FOOD CO., LTD.

TO OUR SHAREHOLDERS

The industry in which the Marudai Food Group operates isfacing an environment that remains severe as consumers
became more budget-conscious due to soaring prices anddeclining real wages amid rising production costs for raw
materials, energy, and other items, which are compounded by
the sharp depreciation of the yen, although there are signs of a
pickup in demand for eating out due to the relaxation of
behavioral restrictions and other factors. Regarding the meat
market, the market prices of domestic beef fell below theprevious year’s level, which had seen recovery, but the market
is currently around the same level as the previous year. While
local market prices for U.S. beef and pork have remained
below the previous year’s levels due to a decrease in demandcaused by high prices, import prices have remained high dueto the impact of foreign exchange rates and other factors. In
addition, the market prices of domestic pork are currently
higher than they were in the previous year, mainly due toincreased demand as a result of factors such as rising prices ofimported pork.

First of all, we would like to express our profound gratitude forthe continued support of our shareholders.
We hereby would like to announce the business results for the
first six-month period of the company’s 75th fiscal year.
During the first six-month period ended 30th September
2022, the Japanese economy continued to pick up moderately,
despite the prolonged impact of COVID-19, due to the effectsof various policies and other measures as the country moved
into a new phase of living alongside COVID-19, including theeasing of behavioral restrictions. However, the outlook for the
economy remains unpredictable, mainly due to rising raw
material prices and energy costs, supply constraints, andfluctuations in financial and capital markets amid concerns
about the risk that a downturn in overseas economies could put
downward pressure on Japanese economy as global monetary
tightening and other factors continue.

In this situation, the Group, a comprehensive food
manufacturer that supplies consumers with safer and healthierfood products, has pushed ahead with its corporate operations,aiming to be a company whose own value is thoroughly
recognized in society.
As a result, consolidated net sales for the first six-month
period increased by 1.2% year on year to ¥110,558 million.
Operating loss was ¥754 million (compared to operating
income of ¥101 million in the same period of the previousyear) and loss attributable to owners of parent was ¥576
million (compared to profit attributable to owners of parent of¥98 million in the same period of the previous year).
Once again, we would like to express our gratitude to ourshareholders and to ask for your continued support of ourbusiness in the future.
December 2022.

Yuji Sato
President and Representative Director

1

MARUDAI FOOD CO., LTD.

PRODUCTS

Processed Food Products
The Ham & Sausage Products operations conducted sales promotion activities including “Hajikeru Natsu no Juicy Campaign”
with a focus on mainstay products such as “Kunseiya-Ripened Pork Sausage.” In addition, new products were introduced fromthe “Itsumo Shinsen” series, such as “Itsumo Shinsen - Specially Selected Pork Sausage,” a rich and juicy sausage, and “Chiikawa
Fish Sausage,” featuring popular characters, in an effort to expand sales.
As for midyear gifts, products from series including “Oh-Ha” and “Kosai” as well as “Seaweed Salt MEISTER Zero Sugar”
using domestic pork were introduced in order to expand sales. Despite these measures, sales in the Ham & Sausage Products
operations decreased by 5.2% year on year, mainly due to a decline in sales volume as consumers became more budget-conscious
due to price revisions.
In our Precooked & Processed Foods operations, sales promotion activities were conducted for retort curry products toincrease awareness, particularly for the “Bistro Club Beef Curry” series, and the limited-edition “Chef’s Craft Spicy Chicken
Curry” was released from the “Chef’s Craft” series. New products were also introduced, including “Kanbi Shokudo” (literally
meaning Korean gourmet food) series as easy-to-prepare meals that boast authentic taste you had only been able to enjoy only at
diners in Korea before, and the “High Protein, 0g Sugar Salad Chicken” series that provides an easy way to consume protein. In
addition, sales of rice products for convenience stores and whipped cream were strong. As a result, sales in the Precooked &Processed Foods operations increased by 1.9% year on year.
As a result, sales in the Processed Food Products segment amounted to ¥73,415 million, a decrease of 1.2% year on year.
Segment loss of ¥768 million was recorded (compared to segment loss of ¥240 million in the same period of the previous fiscal
year) owing mainly to decrease in sales in Ham & Sausage Products and increase in raw material and energy costs that exceeded
price revisions, although we strove to reduce costs through price revisions and rationalization.
Meat Products
With regard to beef, sales of high-priced domestic beef to mass retailers remained sluggish, but overall beef sales exceeded theprevious year’s level due to factors such as a large year-on-year increase in sales to restaurants, reflecting the impact of therelaxation of behavioral restrictions and other factors. Regarding pork, sales of both domestic and imported meat exceeded theprevious year’s level due to higher unit sales prices to mass retailers and a pickup in sales to restaurants. Chicken sales remained
strong, mainly due to our focus on expanding sales of imported chicken meat.
As a result, sales in the Meat Products segment increased by 6.6% year on year to ¥37,076 million. Segment loss of ¥6 million
was recorded (compared to segment income of ¥308 million in the same period of the previous fiscal year), due mainly to thelack of penetration of efforts to pass on price increases in response to the sharp rise in purchase prices due to the rapid
depreciation of the yen and soaring feed prices.
Other
Sales in the Other business decreased by 19.8% year on year to ¥67 million and Segment income decreased by 40.1% to ¥20
million.

2

MARUDAI FOOD CO., LTD.

CONSOLIDATED BALANCE SHEETS
30th September 2022 and 2021
(Unaudited)

Millions of yen
2022
2021

ASSETS
Current assets:
Cash and time deposits ........................................................................
Receivables:
Trade notes and accounts ................................................................
Other ...............................................................................................
Allowance for doubtful accounts ....................................................
Inventories ...........................................................................................
Advances and other current assets .......................................................
Total current assets ..........................................................................
Investments and other assets:
Investment securities
Affiliates .........................................................................................
Other ...............................................................................................
Retirement benefit asset ......................................................................
Deferred tax assets ..............................................................................
Other ....................................................................................................
Allowance for doubtful accounts .........................................................
Total investments and other assets ..................................................
Property, plant and equipment, at cost:
Land .....................................................................................................
Buildings and structures ......................................................................
Machinery and equipment ...................................................................
Lease assets .........................................................................................
Construction in progress ......................................................................
Less accumulated depreciation ............................................................
Net property, plant and equipment ..................................................
Intangible assets .....................................................................................
Total assets ..........................................................................................
See the accompanying note.

3

Thousands of
U.S. dollars (Note)2022¥7,384¥8,605$50,991

24,045836(10)20,233798
53,28623,4701,123(11)17,359920
51,466

166,045
5,773(69)
139,7215,511
367,972247
11,552
2,306
330
2,436
(119)
16,752

189
12,831
1,834
357
2,544
(110)
17,645

1,706
79,773
15,924
2,279
16,823(822)
115,683

18,66563,491
79,492
9,737
764
172,149(111,963)
60,186
1,908¥ 132,132

18,72362,174
77,684
9,058
631
168,270(107,327)
60,9432,568¥ 132,622

128,893
438,443548,940
67,2405,276
1,188,792(773,172)
415,620
13,176$912,451

Millions of yen
2022
2021

LIABILITIES AND NET ASSETS

Thousands of
U.S. dollars (Note)
2022

Current liabilities:
Payables:Trade notes and accounts payable ...................................................
Other ...............................................................................................
Short-term borrowings ........................................................................
Long-term debt due within one year ...................................................
Short-term lease obligations ................................................................
Accrued income taxes .........................................................................
Allowance for bonuses ........................................................................
Other current liabilities ........................................................................
Total current liabilities ....................................................................

¥22,955
6,283
12,251
2,446
1,103
169
863
1,593
47,663¥22,653
7,198
8,712
2,411
990
131
958
1,706
44,759$ 158,518
43,38884,601
16,891
7,617
1,167
5,960
11,000329,142

Long-term liabilities:
Long-term debt due after one year ......................................................
Long-term lease obligations ................................................................
Deferred tax liabilities .........................................................................
Liabilities for retirement benefits ........................................................
Other long-term liabilities ...................................................................
Total long-term liabilities ................................................................

3,510
4,215
818
1,412
662
10,617

3,565
4,496
1,360
1,323
671
11,41524,23929,107
5,649
9,751
4,571
73,317

Shareholders’ equity:
Common stock
Authorised — 40,000,000 shares in 2022 (40,000,000 shares in 2021)
Issued — 26,505,581 shares in 2022 (26,505,581 shares in 2021) .....
Capital surplus .....................................................................................
Retained earnings ................................................................................
Treasury stock, at cost .........................................................................
Total shareholders’ equity ...............................................................

6,716
22,08642,801(3,342)
68,261

6,716
22,08644,607(3,066)70,343

46,378
152,517295,567(23,079)
471,383

Accumulated other comprehensive income:Unrealised gains on securities .............................................................
Deferred gains on hedges ....................................................................
Foreign currency translation adjustments ............................................
Adjustments for retirement benefits ....................................................
Total accumulated other comprehensive income ............................

4,864
101
61
(98)
4,928

5,615
33
34
(201)
5,481

33,589
698
421
(677)
34,031

Noncontrolling interests ........................................................................
Total net assets .....................................................................................
Total liabilities and net assets ..............................................................

663
73,852¥ 132,132

624
76,448¥ 132,622

4,578
509,992$ 912,451

NET ASSETS

See the accompanying note.

4

MARUDAI FOOD CO., LTD.

CONSOLIDATED STATEMENTS OF INCOME
Six months ended 30th September 2022 and 2021
(Unaudited)Thousands of
U.S. dollars (Note)
2022

Millions of yen
2022
2021
Net sales ..................................................................................................
Cost of sales ............................................................................................

¥ 110,558
95,365¥ 109,204
92,599$ 763,469
658,552

Gross profit ..........................................................................................
Selling, general and administrative expenses ......................................

15,193
15,947

16,605
16,504

104,917
110,124

Operating profit (loss) .........................................................................

(754)

101

(5,207)

Other income (expenses):
Interest and dividend income ..............................................................
Real estate rent ....................................................................................
Interest expense ...................................................................................
Loss on disposal of property, plant and equipment, net ......................
Loss on impairment of assets ..............................................................
Other, net .............................................................................................

171
76
(113)
(83)
(9)
104

169
86
(112)
(92)
(9)
88

1,181
525
(780)
(573)
(62)
717

146

130

1,008

Profit (loss) before income taxes ............................................................

(608)

231

(4,199)

Income taxes:
Current .................................................................................................
Deferred ...............................................................................................

110
(151)

135
(17)

759
(1,043)

(41)

118

(284)

Profit (loss) ..............................................................................................
Profit attributable to noncontrolling interests ......................................

(567)
(9)

113
(15)

(3,915)(63)

Profit (loss) attributable to owners of parent .......................................

¥(576)¥98$(3,978)U.S. dollars (Note)

Yen
Profit (loss) attributable to owners of parent per share .......................
See the accompanying note.

5¥(22.87)¥3.88$(0.16)MARUDAI FOOD CO., LTD.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Six months ended 30th September 2022 and 2021
(Unaudited)

Millions of yen
2022
2021

Thousands of
U.S. dollars (Note)
2022

Profit (loss) ..............................................................................................
Other comprehensive income:Unrealised gains on securities .............................................................
Deferred gains (losses) on hedges .......................................................
Adjustments for retirement benefits ....................................................
Share of other comprehensive income of associates accounted for using equity method ....
Total other comprehensive income .................................................
Comprehensive income ..........................................................................

¥ (567)¥113$ (3,915)

(126)
30
35
27
(34)
¥ (601)

(332)
(2)
51
–
(283)
¥ (170)

(870)
208
241
186
(235)
$ (4,150)

Comprehensive income attributable to:
Owners of the parent ...........................................................................
Noncontrolling interests ......................................................................

¥ (610)¥9¥ (185)¥15$ (4,213)$63

See the accompanying note.

6

MARUDAI FOOD CO., LTD.

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS
Six months ended 30th September 2022 and 2021
(Unaudited)Thousands of
U.S. dollars (Note)
2022

Millions of yen
2022
2021
Common stock:
Balance at beginning and end of period .............................................

¥ 6,716¥ 6,716$ 46,378

Capital surplus:
Balance at beginning and end of period .............................................

¥ 22,086¥ 22,086$ 152,517

Retained earnings:
Balance at beginning of period ...........................................................
Cash dividends paid ...........................................................................
Profit (loss) attributable to owners of parent ......................................
Balance at end of period .....................................................................

¥ 44,133
(756)
(576)
¥ 42,801¥ 45,271(762)
98¥ 44,607$ 304,766(5,221)(3,978)$ 295,567

Treasury stock, at cost:
Balance at beginning of period ...........................................................
Purchase of treasury stock ..................................................................
Balance at end of period .....................................................................

¥ (3,066)(276)¥ (3,342)¥ (2,697)(369)¥ (3,066)$ (21,173)(1,906)$ (23,079)

Unrealised gains on securities:
Balance at beginning of period ...........................................................
Decrease for period ............................................................................
Balance at end of period .....................................................................

¥ 4,990(126)¥ 4,864¥ 5,944(329)¥ 5,615$ 34,459(870)$ 33,589

¥

71
30
101

¥

35
(2)
33

$

34
27
61

¥

34
–
34

$

Deferred gains on hedges:
Balance at beginning of period ...........................................................
Increase (decrease) for period ............................................................
Balance at end of period .....................................................................

¥

¥

$

490
208
698

Foreign currency translation adjustments:
Balance at beginning of period ...........................................................
Increase for period ..............................................................................
Balance at end of period .....................................................................

¥

Adjustments for retirement benefits:
Balance at beginning of period ...........................................................
Increase for period ..............................................................................
Balance at end of period .....................................................................

¥ (133)35¥ (98)¥ (252)51¥ (201)

$

¥

¥

$ 4,54434$ 4,578

Noncontrolling interests:
Balance at beginning of period ...........................................................
Increase for period ..............................................................................
Balance at end of period .....................................................................
See the accompanying note.

7

¥

¥

658
5
663

¥

¥

613
11
624

$

$

235
186
421

(918)
241
(677)

MARUDAI FOOD CO., LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS
Six months ended 30th September 2022 and 2021
(Unaudited)

Millions of yen
2022
2021
Cash flows from operating activities:
Profit (loss) before income taxes .........................................................
Depreciation and amortisation ............................................................
Loss on impairment of assets ..............................................................
Decrease in allowance for doubtful accounts ......................................
Decrease in liabilities for retirement benefits ......................................
Interest and dividend income ..............................................................
Interest expense ...................................................................................
Loss on valuation of investment securities ..........................................
Loss on disposal of property, plant and equipment,net .......................
Decrease (increase) in receivables ......................................................
Increase in inventories .........................................................................
Increase in trade notes and accounts payable ......................................
Decrease in consumption tax payable .................................................
Other, net .............................................................................................
Subtotal ...........................................................................................
Interest and dividends received ...........................................................
Interest paid .........................................................................................
Income taxes paid ................................................................................
Income taxes refund ............................................................................
Payments for special retirement expenses ...........................................
Net cash provided by operating activities .......................................

$(4,199)
26,020
62
(76)
(649)
(1,181)780–
573(4,157)(23,099)
14,191
(387)
(565)
7,313
1,347
(774)
(994)

(20)
1,137

¥231
3,820
9
(4)
(172)
(169)
112
24
92
366
(1,485)
2,398
(12)
(235)
4,975
175
(111)
(180)
62
(204)
4,717

Cash flows from investing activities:
Purchase of short-term investments and investment securities ...........
Purchase of property, plant and equipment .........................................
Proceeds from sale of property, plant and equipment .........................
Other, net .............................................................................................
Net cash used in investing activities ...............................................

(18)(3,013)154(52)(2,929)(18)(2,914)580(123)(2,475)(124)(20,807)
1,063
(359)
(20,227)

Cash flows from financing activities:
Net increase in short-term borrowings ................................................
Repayment of long-term debt ..............................................................
Repayment of lease obligations ...........................................................
Cash dividends paid .............................................................................
Purchase of treasury shares .................................................................
Other, net .............................................................................................
Net cash provided by (used in) financing activities ........................

4,151(1,413)
(518)
(755)
(276)
(4)
1,185

822
(1,331)
(470)
(762)
(369)
(3)
(2,113)

28,665(9,758)(3,577)(5,214)(1,906)(27)
8,183

Net increase (decrease) in cash and cash equivalents .........................
Cash and cash equivalents at beginning of period ..............................
Cash and cash equivalents at end of period .........................................

(607)
7,991
¥ 7,384

129
8,476¥ 8,605(4,192)
55,183$ 50,991

See the accompanying note.

8¥(608)
3,768
9
(11)
(94)
(171)
113
–
83
(602)
(3,345)
2,055
(56)
(82)
1,059
195
(112)
(144)

Thousands of
U.S. dollars (Note)
2022

159

1,098

(138)
7,852

MARUDAI FOOD CO., LTD.

NOTE TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)

Basis of financial statements
MARUDAI FOOD CO., LTD. (the “Company”) and its consolidated domestic subsidiaries maintain their official
accounting records in Japanese yen and in accordance with the provisions set forth in the Japanese Company Law andaccounting principles and practices generally accepted in Japan (“Japanese GAAP”). The accounts of overseas
affiliated companies are based on their accounting records maintained in conformity with generally accepted
accounting principles and practices prevailing in the respective countries of domicile. Certain accounting principles
and practices generally accepted in Japan are different from International Accounting Standards and standards inother countries in certain respects as to application and disclosure requirements. Accordingly, the accompanying
financial statements are intended for use by those who are informed about Japanese accounting principles andpractices. These financial statements should be read along with the Annual Report to Shareholders for the year ended
31st March 2022.
The translation of the Japanese yen amounts into U.S. dollar amounts is included solely for the convenience ofreaders outside Japan, using the prevailing exchange rate at 30th September 2022, which was ¥144.81 to U.S. $1.00.
These translations should not be construed as representations that the Japanese yen amounts have been, could havebeen, or could in the future be converted into U.S. dollars at this or any other rate of exchange.

9

DIRECTORS AND STATUTORY AUDITORS(As of 30th September 2022)

President andRepresentative Director:

Yuji Sato

Director and Chairman:

Tokuo Kudara

Directors:

Nobuyoshi Katoh
Toshio Tanaka

Outside Directors:

Masahiro Fuchizaki
Keiko Kaneko

Statutory Auditor:

Toru Miyachi

Outside Statutory Auditors:

Takashi Matsuzawa
Motoaki Nishimura

10

OUTLINE OF THE COMPANY(As of 30th September 2022)

Established:

Major Subsidiaries:

10th June 1958

Hokkaido Marudai Food Co., Ltd.
Stated Capital:

Tohoku Marudai Food Co., Ltd.

¥6,716 million

Shin-etsu Marudai Food Co., Ltd.
Chubu Marudai Food Co., Ltd.

Number of Employees: 2,025

Chu-Shikoku Marudai Food Co., Ltd.
Head Office:21-3 Midori-cho, Takatsuki-shi,

Kyushu Marudai Food Co., Ltd.

Osaka, Japan

Toda Foods Co., Ltd.
Azumino Food Co., Ltd.

Branch Office:4-7-5 Tsukiji, Chuou-ku,

Toraku Foods Co., Ltd.

Tokyo, Japan

Marudaifood Supply Co., Ltd.
Marushin Foods Co., Ltd.

Sales Offices:

The sales headquarters at thePioneer Foods Co., Ltd.

Company’s head office in Osaka

Umeya Co., Ltd.

controls 10 distribution centers andYahata Food Co., Ltd.

6 regional sales departments which

Hornmeier Co., Ltd.

service 23 local outlets.

Marudaifood Co., Ltd.
Marudai Meat Co., Ltd.

Plants:Hokkaido, Iwate,

Meat Supply Co., Ltd.

Niigata, Kanto,

Marbest Trading Co., Ltd.

Ibaraki, Yokosuka, Shonan,

Marudai Service Co., Ltd.

Shizuoka, Matsusaka,

6 Other subsidiaries

Takatsuki, Okayama,
Associated Company:

Hiroshima, Karatsu

Betagro MF Deli Co., Ltd.

11

Head Office: 21-3 Midori-cho, Takatsuki-shi, Osaka, Japan
Telephone: 81-726-61-2518 Fax: 81-726-61-5006