December 2019 15th Ordinary General Meeting of Shareholders

Investor Relations

General meeting of shareholders

December 2019 15th Ordinary General Meeting of Shareholders

Video of the day

ご質問とその回答

Questions about marketing strategies for the healthcare business from a business administration perspective
<Kotosaka>
We will respond by nominating the chair. At Euglena, we do not simply sell products to increase sales, but we ask our customers to understand and understand the effects of Euglena (Japanese name: Euglena) before using it. As a result, we have been discussing with the desire to create a system that can generate sales.

To that end, we used a scientific method to survey about 2,000 people about the efficacy of Euglena. Based on the results of the survey, we are planning the marketing strategy announced in November 2019, so we recognize that we are able to present a certain rationality and a direction with the possibility of sales recovery. Of course, I cannot say absolutely as an academic discipline, but as an individual who is an expert in business administration, I am aware that appropriate management decisions are being made.
Questions about competition
<Izumo>
The lack of rivals means that the government and customers Euglena company, so some people may be worried. Euglena 's diverse sources of procurement are needed to grow as an industry.

In fact, there are universities and companies that are doing Euglena research not only in our company but all over the world. We will firmly establish the brand that we have been working on for 15 years since 2005, and it is welcome that new rivals will emerge and the market will expand. When that happens, I think the most important thing is to steadily create a brand that can contribute to improving the profits of the original Our
Opinions about the age of management
<出雲>
今年から主に流通営業部門におきまして、大手の食品会社に所属していた方々を顧問やアドバイザーとしてお迎えし、積極的にご経験や知恵を活用させて頂いております。
Questions about measures against climate change and carbon dioxide emissions and the effects of biofuels
<Izumo>
First, petroleum-derived jet fuel and bio-jet fuel both emit carbon dioxide when moving an airplane. However, since bio-jet fuel absorbs carbon dioxide in the air by photosynthesis when making raw materials, the increase in the amount of carbon dioxide in the air can be suppressed by using bio-jet fuel.

Jet fuel made from petroleum digs oil from the ground and uses the excavated oil as jet fuel. As a result, the amount of carbon dioxide in the air increases because what was in the ground is put out on the ground and used. Specifically, the concentration of carbon dioxide in the atmosphere was about 280ppm until 100,000 years ago. Using various energies since the Industrial Revolution, it is now 400ppm.

If we do not reduce carbon dioxide emissions, climate change, typhoons will become larger, and meteorological disasters will increase, so we are switching to sustainable bio-jet fuel that circulates on the ground without digging any more oil from the ground. I think we have to do it.
Questions about "Euglena Green Juice" and "Drinking Euglena
<Izumo>
"Euglena green juice" and "Euglena drink" are classified as so-called dietary supplements and are not foods for specified health use (hereinafter referred to as "Tokuho"). In addition, we are not considering applying as Tokuho.

As a basic idea of Tokuho, it is thought that products that can clearly show one effect for one ingredient are suitable.

However, Euglena are 59 kinds of nutrients and paramylon, which is a unique ingredient, and one of the selling points is that it contains a lot of good things, so it will be decided which ingredient to apply to Tokuho in the future. We also think that careful consideration is required.
Questions about the types of bio-jet fuel and bio-diesel fuel
<Izumo>
Our biofuel production demonstration plant refines diesel and jet fuels, or more accurately, even smaller amounts of naphtha.

Diesel fuel derived from fossil fuels and biodiesel fuel produced by us are exactly the same hydrocarbon. Since the biodiesel fuel currently on the market is not a complete hydrocarbon, it can only be mixed up to 5% due to its adverse effect on the engine. In contrast, we are now able to produce biodiesel fuel that is 100% alternative to fossil fuel-derived diesel fuel. This is the result of research with Isuzu Motors Ltd.

Jet fuel for airplanes is used in very cold and cold places. Since it is used in a very low temperature environment such as -100 degrees Celsius, both light oil and gasoline freeze. Bio-jet fuel is the same as fossil fuel-derived jet fuel.

Jet fuel's greatest characteristic and difficulty is that its chemical structure is different from other fuels in order to maintain low temperature fluidity. The biggest difference between diesel fuel and jet fuel is that they either harden or do not harden in very cold places, so-called low temperature fluidity.
Questions about when to announce energy business goals
<Izumo>
In December 2015, we announced at the ANA hangar at Haneda Airport that we will fly an airplane with domestic bio-jet fuel in 2020. At that time, most people said that they couldn't do that, but at that time, they asked the same question (as in the previous section), "Is there anything different from the others?"
Questions about stock price increases in the first half of 2019
<Izumo>
During the period when the stock price was strong from spring to summer 2019, we announced that we will take on the challenge of forming a large-scale factory in Indonesia with ITOCHU and a partnership with Denso. It is presumed that the market and investors were relieved that the commercialization of bio-jet fuel was progressing in both cases, and that they had a good impact. We believe that it is an important role of the company to continue to disseminate positive news sources to the market, not limited to the acquisition of ASTM certification *.

* In order for bio-jet fuel to be introduced into commercial aircraft, ASTM D7566 standard certification, which guarantees the same level as petroleum-based jet fuel, is required.

Questions about the difference between biofuels and other new energies
<Izumo>
Besides biofuels, there are electric vehicles, hydrogen vehicles, hybrid vehicles, etc. Biofuels are made from a variety of sources such as corn and sunflowers, and Euglena is one of them.

About 200 liters of bio-jet fuel is used in one hour. The maximum amount of biofuel that our factory produces in a year is 125,000 liters, so you may think that it is quite small, but I think that 0 must be changed to 1 first.

There is currently no bio-jet fuel in Japan. Therefore, I think it is our mission as a venture company to complete something unique. Many companies have invested and supported us, but that is because there is no bio-jet fuel in Japan and we have to reduce carbon dioxide emissions in Japan in the future, so we have the most expectations. I think it is a sign of what we are doing.

It is a very difficult research and there is no precedent, so there are many difficult things to do, but I would like to continue to work toward the goal of putting it into practical use as soon as possible so that it can be used by airlines. increase.
Opinions on advertising of Euglena containing beverages *
<Izumo>
Euglena has a higher absorption rate than other plants, and when consumed, it digests and absorbs 93% of 59 types of nutrients. Other plants cannot absorb this much.

Euglena has a digestion and absorption rate of 93%, so it is highly evaluated by elderly customers such as those who get sick in the summer and those who cannot eat a large amount. I think we should better convey the goodness of digestion and absorption to such people. We also hear that small children who don't like to eat and don't like vegetables find it difficult to eat vegetables. Euglena 's vegetable juice, which 96% of doctors recommend, is "good because it contains a lot of nutrients."

Each customer has different needs and needs. We have communicated to each customer the goodness of the product, the goodness of Euglena, and the goodness of the company in cooperation with each other so that 95% of customers who have not Euglena I think that.

* "Drinking Euglena", "Drinking Euglena Lactic Acid Bacteria", "Delicious Euglena Vegetables and Lactic Acid Bacteria", etc.

Questions about the taste of "Euglena
<Izumo>
He pointed out that "make the taste more delicious". I think many of you are feeling the same. The most difficult thing is the effort to improve the taste, and we are working on two main themes. Specifically, there are Euglena itself delicious and to prevent it from going bad in the manufacturing process.

Euglena itself delicious, we carefully researched when it does not become so unpleasant and whether it does not emit foreign substances, by dividing the culture level, and ship it in the most delicious state. I am trying to do it. It will take some time, but researchers are taking the lead in working on Ishigaki Island in Okinawa Prefecture, and I think it is a field that will gradually improve.

In the second manufacturing process, Euglena and the nutrients that are the source of odor due to the breakage of cell membranes are not easily perceived by the sense of taste and smell. Must be treated delicately. Due to a considerable review of the manufacturing process, it is definitely tastier than our products five years ago. I think that Ishigaki Island must continue to make constant efforts to improve the method of culturing and growing Euglena itself so that new people will find it delicious.

In addition, when the number of Euglena was increased from 500 million to 700 million, 700 million customers were more experienced, and voices such as "I feel better" and "I feel better". I have received. Therefore, in our product design, in Euglena as possible, we would like to improve the taste and at the same time gradually increase the blending amount to promote product creation in a direction that makes you feel more happy. .. In any case, we recognize that we must reflect on the indication that the taste is not good, and we will continue to seriously work on improving the taste.
Questions about stock prices
<Izumo>
Despite the support of a large number of investors regarding the stock price, we take it seriously that the stock price is unsatisfactory and the result is, and how can we improve social value, shareholder value, and corporate value? I am seriously thinking about whether I can do it. It's important to make enough money, but I'm thinking of taking on the challenge in a way that is unique to us.

For example, there is a difference of 8 years for men and 12 years for women in terms of healthy life expectancy and average life expectancy. We cannot leave this state unattended, and we will extend the healthy life expectancy of everyone, including group companies. We will also promote long-term efforts to develop new energy that is friendly to the global environment. Approximately 88,000 people have bought the stock and have the opportunity to do so. It would be best if we could give back immediately, but we will make the stock price pleasing to everyone through a way of giving back, such as making you and the earth healthy in a way that no other company can do.

I know this is not a common sense approach. However, we would like to realize a future in which we can give back to our shareholders and make them happy so that we can expect Euglena
Questions about marketing strategy
<Nagata>
My name is Nagata and I am in charge of marketing. We will respond by nominating the chair.

We are reviewing and revising our marketing strategy from four major perspectives, as our current healthcare business as a whole is not performing well.

First and foremost, the R & D team is most committed to improving the taste. On top of that, we are currently focusing on research and development from the perspective of promoting ease of drinking and health.

The second is the price. We are challenging how to make the price more affordable for everyone.

And the third and most important point is that in addition to the business centered on mail-order sales, we have demonstrated necessary product development and necessary promotions so that they can be picked up at general supermarkets, drug stores, and convenience stores. We will continue to.

The fourth and final point is the recognition of materials. The sharpest point is that even if you say "Drink Euglena", you don't understand Euglena itself, and I think that's right. In this term (16th term), the marketing team will make an effort to promote the material itself, Euglena, and raise awareness of the material.

Euglena has the greatest strength. The material Euglena is almost exclusively owned by us, so Euglena can enjoy almost all the results of advertising for this material. For example, no matter how much you throw a commercial called lactic acid bacteria in general, there is a possibility that profits will flow to other companies that handle lactic acid bacteria. However, we have a monopoly on the material Euglena, so strengthening it steadily will lead to our recognition of the material and ultimately the motivation for our customers to pick it up. We believe.

We are preparing for this, and we started the promotion during this term, and we have come to see the benefits of Euglena itself and what it works for our shareholders. I am confident that you will be able to feel. I believe that when the general meeting of shareholders is held next year, we will be able to meet the general meeting of shareholders with a clear view of what kind of products and what kind of promotion, so please continue to support us. I would like to receive it.
Questions about fixed asset impairment and R & D expenses
<Nagata>
My name is Nagata and I am in charge of finance. We will reply by appointment of the chairman.

In the 15th term, goodwill and temporary accounts related to buildings were amortized, resulting in a deficit, and there are no fixed assets that are expected to be impaired any further. Large assets currently recorded include the Ishigakijima factory building and some machinery and equipment, but as long as the current healthcare business is doing well, it will not be subject to impairment. In addition, we believe that the maximum R & D cost is about 1 to 2 billion yen, including the R & D cost for the biojet diesel fuel demonstration plant and the R & D cost for food. As mentioned above, we can say that there are currently no signs of insolvency due to the impairment of fixed assets and R & D expenses.
Opinions and questions about business plans and collaboration with other companies
<Izumo>
Today, I explained the development of a big strategy to expand from 1% of core fans to Euglena However, we are not thinking of achieving this by ourselves, and I think it will be important to support and collaborate with various companies, including food companies. In August 2019, Kourakuen and our company Euglena for a limited time. These efforts have been ongoing since 2015, four years ago. Together with Ito-Yokado and each food manufacturer, we have developed and launched 5 to 6 items as exclusive products for Ito-Yokado.

However, at that time, newspapers and television covered only Euglena but I think that it will not spread unless we tell you what Euglena increase.

Currently, the number of items is not sufficient, so we will continue to expand the number of items that collaborate with food companies. At the same time, we will invest in the most efficient ones and expand them, and we would like to make the promotion as speedy as possible so that everyone can see it. We have hired the necessary human resources for that purpose and have a sufficient system in place to implement it, so please keep an eye on the changes in our promotion in the future, and at the same time, if you have any specific suggestions, please let us know. I would appreciate it if you could.

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