TheChek News Flow

Co sees FY14 Op income of JPY 9.4 trln vs JPY11.7 trln prior forecast; sees revs of JPY221 trln vs JPY250 trln prior forecast. (Note - forecasts were from beginning of FY).

• The company withdrew its original earning guidance due to the uncertainty of sales and profits affected by the Shanghai HUSI incident. However, we have decided today to re-set our 2014 earnings guidance based on currently available information and estimations
• The company's financials have been/will be largely affected by the Shanghai HUSI incident. Co states it is probable that sales for this year will be far lower than expected at the beginning of the year.

Co states: "...This will significantly affect our overall profitability, due to the profit impact from the sales decline, costs impacts either directly or indirectly resulting from the incident as well as our strategic investments to recover from the incident by regaining customer confidence in our food. Furthermore, we expect to see large extraordinary losses from write-offs of unsold food products and impairment charges on our restaurants stemming from the incident, resulting in the large net losses for the year.."