NISSIN FOODS GROUP

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VALUE CREATION PROCESS

Building on our founder's spirit, the NISSIN FOODS Group harnesses its six management resources (capital) and excels in branding, marketing, and innovation to craft captivating products that generate economic value and social value. By iterating on this sequence of actions, we personify the ideals of our founder, setting our sights on lasting growth—this is our Group's blueprint for value creation.

Value Creation Process in Becoming a Century Brand Company

EARTH FOOD CREATOR Toward Becoming a Century Brand Company

Our Fundamental Philosophy and the Social Issues We Aim to Solve

The origins of the NISSIN FOODS Group began by addressing Japan's post-war food crisis. More than 60 years after its establishment, the world now faces new environmental and social challenges. Of particular concern to our Group are issues related to “Planetary Health (Sustainability),” which includes dwindling resources and climate change, as well as challenges tied to “Human Well-being,” like excessive calorie intake and hidden hunger. The NISSIN FOOD Group aims to achieve sustainable growth in order to solve environmental and social issues as an "EARTH FOOD CREATOR" committed to continuously creating new kinds of food culture through innovation.

Fundamental Philosophy

  • MissionENDURING VALUES
  • VisionEARTH FOOD CREATOR
  • ValuesFOUR ATTRIBUTES
GROUP PHILOSOPHY

Main Social Issues to Address

Planetary Health (Sustainability)

Human Well-being

Promotion Structures and Material Issues

Capital

At the heart of the NISSIN FOODS Group's business are six kinds of capital that include our financial capital, our people, and the strength of our brand. By accumulating and managing these different kinds of capital, identifying and maximizing their allocation in a business environment fraught with uncertainties, we are able to create new kinds of food culture and achieve sustainable growth for the Group.

  • Financial Capital

    Sound Financial Position and High Profitability
    • Equity Attributable to Owners of the Parent: 60.8%
    • Net Debt/EBITDA: -0.4x
    • Free Cash Flow: ¥32.8 billion
  • Human Capital

    The Driving Force Behind Our Business as an EARTH FOOD CREATOR
    • Female Managers: 5.8%
    • Employee Engagement (Agreement with Corporate Philosophy): 78%
    • Percentage of Non-Japanese National Employees: 55%
  • Manufacturing Capital

    Manufacturing Bases and Outstanding Quality Supporting Global Business Activities
    • Group Manufacturing Bases: 36 in Japan; 26 overseas
    • Capital Investment: ¥32.7 billion
    • Kansai Plant Defective Rate: Less than 1 in 1 million
  • Social and Relationship Capital

    Brand Strength Nurtured by Superior Marketing Expertise
    • Advertising Expenses: ¥18.9 billion
    • Product Improvements Based on Customer Feedback: 33 cases (annually)
    • Number of Countries Where CUP NOODLES are Sold: 100+/Sales: ¥200 billion (based on internal NISSIN research)
  • Intellectual Capital

    R&D Bases Supporting Technological Innovation and Investments in New Businesses
    • Number of NISSIN FOODS Group patents: 482 in Japan; 746 overseas*
    • R&D Expenses: ¥11.4 billion
    • Investment in New Businesses: Between 5% and 10% of core operating profit of existing businesses
    *Overseas refers to the total number of countries in which product rights have been granted
  • Natural Capital

    Initiatives to Address Resources and Climate Change Under EARTH FOOD CHALLENGE 2030
    • Water Withdrawal (Domestic and Overseas): 10.5m3 per million yen
    • CO2 Emissions (Scope 1+2): 399,000 t-CO2
    • Sustainable Palm Oil Procurement Ratio: 37.7%
    • Implementation of Sustainability Surveys for Business Partners
(As of March 2023)

Business Activities/Output

The NISSIN FOODS Group's strengths in branding, marketing, and innovation are the major driving force behind its three businesses: the instant noodles business, the non-instant noodles business, and the overseas business. Leveraging these resources will help us achieve our aims to become a leading global company that fills the world with the joys and pleasures of food.

Outcomes

This value creation process is what ensures that the NISSIN FOODS Group generates economic value in the form of sustained profit growth, efficient capital utilization, prudent debt management, and stable shareholder returns. We also provide social value by promoting consumer health, enhancing employee engagement, and passing on a rich, vibrant planet to future generations.

Social Value

  • Promoting Health and Mitigating Early Health Concerns Among Consumers
  • Improving Employee Engagement
  • Handing a Bountiful Planet to Future Generations

Economic Value

Value Category Management Indicators Mid-to Long-Term Targets
Growth Potential Management Indicators Mid-Single Digits
Efficiencies ROE 10% Over the Long Term
Safety Net Debt/EBITDA ratio ≤2x
Stable Shareholder Returns Dividend Policy Progressive Dividends
Relative TSR (Relative to TOPIX Foods) ≻1x
Becoming a Century Brand Company
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