Rise in profits for Ajinomoto

Japanese food ingredients company Ajinomoto recently announced a group net profit of 31.4 billion yen (€266.1 million) in 2001/02.

The company, known for its monosodium glutamate (MSG) seasoning products, said it expected consolidated net profit to edge higher in 2002/03 ending March 31, to 32 billion yen.

The rebound in profit for the past business year follows a group net loss of 11.5 billion yen in 2000/01 when the company booked extraordinary losses of 74.3 billion yen.

Rising sales to Asia helped to counteract flat sales in Japan that were hit by by worries about food safety in the wake of the outbreak of mad cow disease in September, Ajinomoto said.

Ajinomoto - which means "the root of flavour" in Japanese - said group sales rose 3.9 per cent to 943.5 billion yen and it forecast a rise to 990 billion in the current year.

On an operating basis, profits rose 29.7 per cent to 49 billion yen in 2001/02 from 37.8 billion yen a year earlier.

Both Ajinomoto's 2001/02 net profit and 2002/03 forecast were slightly better than consensus estimates compiled by Multex Global Estimates.

Extraordinary losses shrank to just 5.6 billion yen in 2001/02 and the company saw an improvement in profit margins thanks to cost reductions.

Ajinomoto pointed to its easy-to-cook Chinese food base and its amino-acid sports supplement jellies and drinks as strong sellers in the domestic market.

Shares of Ajinomoto closed down 1.36 per cent at 1,307 yen, compared to a 0.93 percent rise in the Nikkei 225 average. The results were announced just minutes before the close.