—Entering the New Year 2024—

I would like to wish everyone a Happy New Year.

Introduction

Last year, 2023, was a year in which the global economy became more unstable as a result of sharp price increases mainly in food and energy caused by the long-drawn-out war in Ukraine. However, the US stock market has recently shown an upward trend due to US interest rates being held steady by the Federal Reserve. We hope that the Japanese stock market, too, will be further revitalized this year.

Last year in Japan, the Company saw an increase in profitability due to higher composition ratios of the number of bottles sold for Yakult 1000 and Y1000. Overseas, the Company pushed ahead with initiatives to achieve a recovery in results which were affected by the COVID-19 pandemic. As a result of these efforts, the number of bottles sold grew steadily in the US, Mexico, Vietnam, and the Philippines, among other countries. However, we struggled in China and Indonesia.

In 2024 too, the Company will engage in activities with confidence based on the Company’s corporate philosophy and make concerted efforts to realize sustainable growth.

Initiatives of Each Segment

In the domestic food and beverages business, Yakult 1000 and Y1000 achieved strong results. Although in 2023 we increased production capacity for Yakult 1000 and Y1000 in March and April, respectively, we were unable to meet demand. In 2024, since there are clear prospects for increasing production capacity earlier than initially planned, we will step up sales activities according to this schedule.

In the home delivery channel, we will conduct activities in earnest to enable Yakult Ladies to increase new customers in an effort to improve the results of Yakult 1000. In addition, we will increase the number of Yakult Ladies with a view to ensuring more contact points with customers.

In the retail store channel, New Yakult products saw a recent decline in the number of bottles sold due to price revisions. In order to make up for this decline, we will strengthen sales promotion activities mainly for Y1000 and continue persistent value dissemination activities to increase the number of bottles sold while proposing the effective creation of sales venues.

We believe that, this year too, the improved results of Yakult 1000 in the home delivery channel and Y1000 in the retail store channel will lift the overall business.

In the international business, we will achieve balanced overall overseas results by increasing countries and regions that can grow stably. To that end, we will strive to expand sales channels by increasing the number of Yakult Ladies and the number of stores handling our products in an effort to broaden sales opportunities. Since the fact remains that overseas markets have high growth potential, we believe that our activities suited to the situation of each country and region will bear fruit, leading to a gradual improvement in overall overseas results.

The aspiration of people all over the world to stay healthy has become stronger than it was before the COVID-19 pandemic. I strongly feel once again that our mission is to respond to this aspiration based on the Company’s corporate philosophy. As a means of doing that, we will further focus on public relations activities such as plant tours, health-related classes and dispatch of guest lecturers that allow us to directly convey to customers our thoughts about Yakult’s corporate attitude and products, and promote understanding of the science of bacteria among customers.

Further, we will proactively pursue “expansion of business domain” also as indicated in Yakult Group Global Vision 2030. Last year we announced the development of products for companion animals that use galacto-oligosaccharides through a capital and business alliance with Japan Pet Communications Co., Ltd., as well as the acquisition of the plant-based yogurt business owned by Pokka Sapporo Food & Beverage Ltd. As seen by these moves, we will pursue expansion of business domain with a view to evolving into a healthcare company by cooperating with other companies, too, while leveraging our know-how and experience cultivated over the years as our strength.

Conclusion

Hiroshi Narita,
President and Representative Director
Yakult Honsha Co., Ltd.