Tingyi (Cayman Islands) Holding Corp, a leading Chinese instant noodle producer, said Monday that its fourth-quarter profit slid 75 percent as consumers shied away from its Japanese-style packaging and marketing amid a territorial row between the two countries.
Tingyi, which has a broad-ranging partnership with PepsiCo Inc and sells noodles under the Master Kong brand in China, said its net profit was $14.9 million for the three months ended in December, down from $59.9 million in the same period a year earlier.
Chinese Ting Hsin International Group holds the controlling stake of 33.27 percent in the noodle maker, while Japanese Sanyo Foods Co owns 33.18 percent.
Japanese-style noodle restaurant chain operator Ajisen (China) Holdings also posted a fall of almost 56 percent in 2012 profit as its sales were similarly hit by anti-Japanese sentiment.
Although the sentiment has calmed somewhat since the worst of the protests following Japan's illegal "purchase" of the Diaoyu Islands in mid-September last year, the problem still hangs over relations between the two countries.
Toyota Motor Corp said combined January-February sales for China were down 13 percent year-on-year.
Tingyi said its profit for 2012 rose 8.5 percent to $455.2 million, its second highest annual result ever. But that lagged market expectations of $485.65 million, said Thomson Reuters Starmine SmartEstimate.
By contrast, rival Want Want China Holdings, the country's top food and beverage maker and distributor by market value, which did not have to deal with anti-Japan sentiment, this month posted a 32 percent rise in 2012 net profit to a record $553.8 million, largely due to softer raw material prices.
Tingyi, which commands just over half of China's $8.8 billion instant noodle market, has benefited as demand for consumer staples climbed, raw material costs fell and production efficiency improved at its bottling plants.