Nitto Fuji Flour Milling

Basic Information

Stock Code
2003
Industry
Food Products
Category Detail
Food Manufacturing
Prefecture
Tokyo
Establishment Year
March 1914
Listing Year
May 1949
Official Website
https://www.nittofuji.co.jp/
TSE Information
TSE Information
Yahoo! Finance
Yahoo! Finance
Other Companies
Nippn, Nisshin Seifun Group Inc., Showa Sangyo, Torigoe Flour Milling, Yutaka Foods, Nisshoku

Overview

Nitto Fuji Flour Milling is a major flour milling company founded in 1914, with a stable management foundation from the Mitsubishi Corporation group, and is a food manufacturer centered on flour milling and food service businesses, providing high value-added products and services.

Current Situation

Nitto Fuji Flour Milling recorded consolidated sales of approximately ¥72.5 billion and operating profit of approximately ¥5.2 billion in the fiscal year ending March 2024, occupying one of the big four positions in the flour milling industry. Its mainstay food and flour milling business accounts for about 83.6% of sales, and the food service business for about 16.1%. It operates flour mills in Vietnam and Thailand and is advancing overseas expansion. It specializes in BtoB small-lot high value-added products, focusing on quality enhancement and planning proposals tailored to customer needs. Following the market segment revision in 2022, it transitioned from the Tokyo Stock Exchange Prime Market to the Standard Market, aiming to establish a foundation for stable growth. Leveraging the logistics and sales network as a consolidated subsidiary under Mitsubishi Corporation, it is also strengthening franchise expansion in food services. While considering sustainability, it is promoting sales expansion and diversification in the medium to long term, along with further technological innovation and market development.

Trivia

Interesting Facts

  • Born in 2006 from the merger of Nitto Flour Milling and Fuji Flour Milling.
  • Occupies one of the big four positions in the flour milling industry.
  • Mitsubishi Corporation holds 64.86% of shares, making it a consolidated subsidiary.
  • Operates overseas flour mills in Vietnam and Thailand.
  • Handles store operations for KFC and Gyu-Kaku in the food service business.
  • Strength in planning and proposing small-lot high value-added products.
  • Transitioned from Tokyo Stock Exchange Section 1 to Standard Market.
  • Also offers brands using locally produced Kumagaya wheat.
  • Diversified operations including warehousing and transportation beyond flour milling.

Hidden Connections

  • Leverages Mitsubishi Corporation group's extensive trading network for business expansion.
  • Gains local restaurant support through food service franchise subsidiary Sawayaka.
  • Enhancing market competitiveness through stock splits and subsidiary acquisitions.
  • Successive presidents have taken turns as chairmen of the flour millers' association.

Future Outlook

Growth Drivers

  • Increased demand for whole wheat and functional flours due to health trends
  • Expansion of BtoB small-lot high value-added products
  • Production expansion and sales strengthening in Southeast Asian markets
  • Expansion of food service franchise store network
  • Introduction of low-environmental-impact technologies in packaging and production processes
  • Advanced food safety and quality management
  • Product development responsive to customer needs
  • Cost reductions through logistics and warehouse efficiency

Strategic Goals

  • Achieve over 30% overseas sales ratio
  • Expand share in commercial flour and mix powders
  • Promote environmental load reduction and sustainability
  • Strengthen regional food service operations and profitability
  • Optimize business efficiency through digitalization
  • Develop and popularize new health-functional flours
  • Build diverse workforce and supportive work environment
  • Strengthen coexistence with local communities
  • Demonstrate leadership in industry organizations such as flour millers' association
  • Establish safe and reliable food supply system

Business Segments

Flour Raw Material Processing Segment

Overview
Handles the manufacturing and supply of high-quality raw material flours and specialty flours.
Competitiveness
High value-added small-lot production capability
Customers
  • Food Manufacturers
  • Confectionery Manufacturers
  • Bakeries
  • Chinese Noodle Producers
  • Japanese Noodle Manufacturers
Products
  • Flour
  • Bran
  • Mix Powders
  • Specialty Flours

Food Service Business Segment

Overview
Diversifies revenue through restaurant operations and franchise expansion.
Competitiveness
Stable franchise network
Customers
  • Franchise Stores
  • Kentucky Fried Chicken
  • Gyu-Kaku
  • Steak Houses
  • Local Restaurant Chains
Products
  • Franchise Store Operations
  • Dining Services
  • Store Management
  • Menu Development

Warehouse and Logistics Segment

Overview
Manages wheat storage to logistics for improved efficiency.
Competitiveness
Utilization of Mitsubishi Corporation group's logistics network
Customers
  • Flour-Related Businesses
  • Manufacturers
  • Trading Companies
  • Transportation Companies
Products
  • Warehouse Storage Services
  • Logistics Management
  • Raw Material and Product Transportation

Overseas Business Segment

Overview
Builds local production and supply systems for the Southeast Asian market.
Competitiveness
Local production capability and quality maintenance at overseas factories
Customers
  • Vietnamese Food Companies
  • Thai Local Producers
  • Overseas Wholesalers
Products
  • Flour Products (Local Production)
  • Frozen Food Ingredients

Competitive Advantage

Strengths

  • Stable management base from Mitsubishi Corporation group
  • High-quality small-lot production technology
  • International expansion via overseas factories
  • Strong food service franchise network
  • Diverse flour milling and food businesses
  • Efficient logistics and warehouse storage capabilities
  • High market share in the flour milling industry
  • Long history and brand trust
  • Flexible response to customer needs

Competitive Advantages

  • Specialization in small-lot high value-added products for differentiation
  • Leveraging Mitsubishi Corporation's sales and logistics network
  • Flour mills in overseas locations (Vietnam and Thailand)
  • Diversification into non-core businesses via food services (Sawayaka, etc.)
  • Customer-centric sales through planning and proposals tailored to needs
  • Strong transaction relationships with food manufacturers and restaurant chains
  • High equity ratio and solid financial position
  • Product development and technological strength in the flour milling industry
  • Presence in the growing frozen and commercial food sectors

Threats

  • Risk of wheat raw material price fluctuations
  • Intensifying competition in the domestic flour milling industry
  • Demand fluctuations due to shifting health trends
  • Intensifying cost competition in overseas production
  • Impact of climate change on wheat production
  • Declining trend in household flour demand
  • Risk of market fragmentation from new entrants
  • Potential raw material import restrictions or trade friction
  • Economic fluctuation risks in the food service industry

Innovations

2023: Equipment Renewal at Southeast Asia Flour Mills

Overview
Updated production equipment at Vietnam and Thailand factories to state-of-the-art for improved efficiency.
Impact
20% increase in production capacity, contributing to quality stability

2022: New Development of Small-Lot Mix Powders

Overview
Expanded lineup of diverse small-lot products tailored to customer needs.
Impact
Improved customer satisfaction and increased new customer acquisition

2021: Introduction of Franchise Store Management System

Overview
Deployed IT system to improve operational efficiency at food service stores.
Impact
10% reduction in store management costs

2020: Promotion of Environmentally Friendly Packaging Materials

Overview
Began using low-environmental-impact materials for flour product packaging.
Impact
15% reduction in annual plastic usage

Sustainability

  • CO2 reduction through energy-saving equipment introduction
  • Promotion of waste recycling
  • Strengthening of green logistics
  • Environmental conservation activities in collaboration with local communities
  • Adoption of low-environmental-impact packaging materials
  • Workstyle reform and diversity promotion
  • Environmental and human rights considerations in supply chain
  • Thorough reinforcement of product quality and safety