The Performance of Supermarkets Amidst the Whirlwind of Food Price Increases.
Listed Companies’ Performance Significantly Exceeds Market Expectations – Is This the Start of a Definitive Escape from Deflation?
Source: Nikkei Nov 1７th 2023
In the July-September period, 104 companies, accounting for 59% of the total, exceeded analyst expectations, marking a significant increase from the previous year’s 52%. This outperformance is the third highest in the last five years, following the recovery phases of the July-September 2020 period (67%) and the July-September 2021 period (62%) from the impact of the COVID-19 pandemic. Manufacturing companies exceeded expectations by 57%, while non-manufacturing companies exceeded by 62%.
The key factors driving this success include improved profitability and increased revenue resulting from the penetration of price increases. Nissan’s net profit, for example, surged to 190.7 billion yen, 11 times higher than the same period last year and 2.1 times the market forecast, with a profit increase of 49.3 billion yen attributed to strategies such as pricing. Kikkoman’s net profit surpassed market expectations by 62%, with a boost in its soy sauce business due to successful price increases and recovering sales volumes in Japan. Murata Manufacturing also outperformed, with a 50% increase in net profit compared to market expectations, driven by the success of high-margin products like surface acoustic wave filters. The positive results reflect an unexpected improvement in the quality of sales, including successful pricing strategies and reduced incentives. Overall, companies are benefiting from a combination of effective cost management and strategic initiatives to boost sales.