Ajinomoto Co. Inc. essay

Ajinomoto Ajinomoto Co. Inc. is a Japanese food and chemical corporation which produces seasonings, cooking oils, TV dinners, sweeteners, amino acids and pharmaceuticals. In particular it is the world's largest producer of aspartame, with a 40% global market share. When Professor Kikunae Ikeda from the University of Tokyo isolated glutamate from the seaweed and discovered its flavour enhancing properties in 1908. The next year, his discovery was introduced to the market in the form of the flavour enhancer AJI-NO-MOTO.

The literal translation of Aji no Moto is “Essence of Taste,” used as a trademark for the company’s original monosodium glutamate (MSG) product. Thanks to the company's eminent status, its brand has found its way even to notable Asian language dictionaries as a half-synonym for MSG. Ajinomoto (Malaysia) Berhad started its business operations in 1961 as AJI-NO-MOTO® monosodium glutamate producer. It is also one of the very first Japanese joint-venture companies to be set up in this country.

Ajinomoto (Malaysia) Berhad has since grown into a dynamic food seasoning manufacturer marketing diverse brand name that is trusted by Malaysian for decades. Our AJI-NO-MOTO® food seasoning is an indispensable item in almost every Malaysian home. Ajinomoto Group Philosophy We create better lives globally by contributing to significant advances in Food and Health and by working for Life. Ajinomoto Group Way Create New Value Create value with new ideas and continuous innovation based on unique technologies and science.

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Product value creation bolstered by technology, new dietary proposals) Pioneer Spirit Continue to constantly take on the challenge of creating new businesses and markets. (Adapt to regional culture and market conditions in creating markets) Social Contribution Accommodate social requirements with humility and honesty, with the objective of maximizing value for society through business activities. (Resolve social issues) (Improve the global environment) (Security and safety) (Trustworthy production) (Fair, impartial, transparent and simple) Value People

Respect the humanity of all the people involved in the Ajinomoto Group's businesses, and be an organisation in which they can grow and display their abilities to the fullest extent. (Provide a workplace where people can flourish) (Career development, support and follow-up) (Fair performance evaluation) (Teamwork) Ajinomoto Group Vision We aim to be “a group of companies that contributes to human health globally” by continually creating unique value to benefit customers.  To become a global group of food companies centered on the world's No. seasoning business. . To become a global group of amino science companies that contributes to humankind with the world's No. 1 amino acid technology. To become a group of health-promoting companies with a scientific approach to good taste and health. Ajinomoto(M) Berhad Segment Analysis Ajinomoto (M) Berhad (Ajinomoto) is a food and chemical corporation that engaged in manufacturing and selling monosodium and other related products. The company is divided into two major segments that publicly report financial reports.

The Umami segment (Umami) comprises of products that are derived from the fermentation process such as Monosodium Glutamate (MSG) and related products. The Umami segment accounted for 70. 0% of 2011 sales, making it the largest Ajinomoto's operating segments. The Food and Seasoning segment (FSS) consists of products derived from the extraction and mixing process such as Industrial Seasonings, Tumix and related seasonings. This segment accounted for 29. 82% of Ajinomoto's sales in 2011. Others segment (Others) products sold by the company comprises of trading goods such as industrial sweetener, feed-use amino acid and frozen foods.

Total Ajinomoto sales increases over the last past years however its profitability has varied. Sales peaked at over RM316 millions in 2011 and has the lowest sales in 2007 at over RM 190 millions. Ajinomoto has yet incurred profit loss over the last five years. Ajinomoto's stock price has been steadily increases from RM1. 95 in 2007 to RM 4. 00 in 2011. Despite the varied profit earning and steadily increases of sales, Ajinomoto has continued to increase gradually from RM0. 79 in 2007 to RM 0. 15 in 2011.

This is a clear indication of the importance that Ajinomoto attaches to the informal content associated with dividends: with the increase of sales, dividends will continue to increase. Industrial Analysis Bloomberg and Reuters have classified Ajinomoto as food processing industry sector. This paper will discuss in details Ajinomoto's financial stability compared with other companies in the food processing industry. The Malaysia Food Processing Industry The food industry in Malaysia is as wide as the multi-cultures of Malaysia, with wide range of processed foods with Asian taste.

The industry is primarily Malaysian-owned, and estimated the present global retail sales in food products are worth around US$3. 5 trillion. It is expected to grow at annual rate of 4. 8 per cent to US$6. 4 trillion in 2020. The industry has more than 9000 processing factories of which 95% are classified as small-scale. Food processing companies are normally perceived as agro-based industries which have a strong backward linkage. However, in Malaysia, this is not the case as it is estimated that over 70% of raw materials used in the processed food are imported.

Therefore, Malaysia is a net importer for food products. Value for imported food increase from RM17. 9 billion in 2005 to RM30. 2 billion in 2010, about RM82 million a day. The increase in 2010 was credited to Malaysia's climate, various economic factors, and higher standard of living. Financial Ratio Analysis Financial ratios for Ajinomoto for food industry are provided as below. The firm in food processing industry subset represent 16% of the total food industry sales of RM1. 972 billion in 2011.

Reference

• http://www. barubian. net/2012/02/rm92m-spent-on-imported-food-every-day. html
• http://www. scribd. com/doc/36423986/Food-Industry-Malaysia
• http://findarticles. com/p/articles/mi_m3723/is_6_15/ai_105043862/
• http://thestar. com. my/archives/2006/8/17/IMP3/chapter19. pdf
• http://www. ifrj. upm. edu. my/19%20(01)%202011/(38)IFRJ-2011-122%20Yodfiatfinda. pdf
• http://www. mida. gov. my/env3/index. php? page=food-industries
• http://www. miti. gov. my/cms/content. jsp? id=com. tms. cms. section. Section_63c203a6-c0a8156f-5cff5cff-cbccc275
• http://malaysia. ahk. de/fileadmin/ahk_malaysia/Bilder/Others/Market_Watch_Food_Industry_2011_ENG_. pdf

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