| Indicator | This Period | Prior Year Same Period | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥360.7B | ¥361.0B | -0.1% |
| Operating Income / Operating Profit | ¥14.3B | ¥15.0B | -4.9% |
| Ordinary Income | ¥14.7B | ¥15.4B | -4.2% |
| Net Income | ¥8.4B | ¥7.1B | +18.4% |
| ROE | 5.4% | 4.7% | - |
For the fiscal year ended April 2026, Revenue was ¥360.7B (YoY -¥0.3B -0.1%), Operating Income was ¥14.3B (YoY -¥0.7B -4.9%), Ordinary Income was ¥14.7B (YoY -¥0.6B -4.2%), and Net Income attributable to owners of parent was ¥8.4B (YoY +¥1.3B +18.4%). Revenue was largely flat, but gross margin declined to 53.6% from 54.2% a year earlier (down 0.6pt). SG&A ratio improved to 49.6% from 50.1% (improvement of 0.5pt), yet operating margin contracted to 4.0% from 4.2% (down 0.2pt). At the ordinary income level, increased interest and dividend income provided support and limited the decline. Special losses decreased from ¥3.2B in the prior year to ¥1.1B (reduction of ¥2.1B), lifting profit before tax to ¥13.6B (prior year ¥12.2B, +12.0%). Despite a high effective tax rate of 40.5%, Net Income achieved double-digit growth.
Revenue was ¥360.7B (YoY -0.1%) and essentially flat. By segment, the Meat Business recorded ¥154.2B (-0.3%) and remained the largest contributor with a 42.7% share; the Prepared Foods Business reported ¥128.4B (+0.1%) with a 35.6% share. Confectionery (Wagashi) posted ¥69.0B (+3.3%) and Food Products ¥25.9B (+2.1%)—both modest increases with limited overall contribution. The Restaurant Business declined to ¥13.1B (-3.4%) due to weak same-store performance. External sales excluding inter-segment transactions totaled ¥360.7B, and intersegment complementarity helped minimize overall decline. There is no regional sales disclosure within the single domestic market; the business is primarily B2C.
At the profit level, gross margin fell 0.6pt from 54.2% to 53.6%, reflecting higher raw material and energy costs and price competition. SG&A decreased to ¥179.1B (prior year ¥180.8B, -0.9%), improving the SG&A ratio to 49.6% from 50.1% (improvement of 0.5pt), but the gross margin decline was not fully offset, resulting in Operating Income of ¥14.3B (-4.9%). By segment, Meat Operating Income was ¥10.2B (+31.3%) driving results, while Prepared Foods ¥9.2B (-21.8%) and Food Products ¥1.0B (-30.8%) suffered margin deterioration; Restaurants turned to a loss of -¥0.2B. Segment total Operating Income was ¥24.0B (prior year ¥24.8B); after corporate expenses and adjustments of -¥9.8B, consolidated Operating Income fell below the prior year. Non-operating items included Interest Received ¥0.2B (prior year ¥0.04B) and Dividends Received ¥0.1B (prior year ¥0.05B), increasing financial income; non-operating expenses were almost zero. Ordinary Income was ¥14.7B (-4.2%), with the decline narrower than at the operating level. Special losses were ¥1.1B (impairment loss ¥0.5B, loss on disposal of fixed assets ¥0.2B, etc.), down significantly from ¥3.2B in the prior year, boosting profit before tax to ¥13.6B (+12.0%). After corporate taxes and others of ¥5.5B (effective tax rate 40.5%), Net Income attributable to owners of parent was ¥8.4B (+18.4%). In conclusion, revenues were flat and operating income declined, but lower special losses and higher financial income led to higher final profit.
Meat Business: Revenue ¥154.2B (-0.3%), Operating Income ¥10.2B (+31.3%, margin 6.6%)—a highly profitable core segment and the largest contributor. Despite a slight revenue decrease, profit rose substantially due to improved cost control and product mix. Prepared Foods: Revenue ¥128.4B (+0.1%), Operating Income ¥9.2B (-21.8%, margin 7.1%)—revenue flat but profit down over 20%, indicating high profit sensitivity. Declining gross margin and fixed cost burden pressured profitability. Wagashi (Confectionery): Revenue ¥69.0B (+3.3%), Operating Income ¥3.9B (-0.3%, margin 5.6%)—revenue up, profit roughly flat. Food Products: Revenue ¥25.9B (+2.1%), Operating Income ¥1.0B (-30.8%, margin 3.8%)—small revenue increase but profit down 30%, showing margin deterioration. Restaurants: Revenue ¥13.1B (-3.4%), Operating Income -¥0.2B (margin -1.6%)—decline and a turn to loss due to fixed cost burden and slow customer recovery. Segment total Operating Income was ¥24.0B (prior year ¥24.8B); after corporate adjustments of -¥9.8B, consolidated Operating Income was ¥14.3B. Meat’s strong performance supported the group, while margin recovery in Prepared Foods, Food Products, and Restaurants remains a priority.
Profitability: Operating margin 4.0% (prior year 4.2%, -0.2pt), Net margin 2.3% (prior year 1.9%, +0.4pt). Operating profitability slightly declined year-on-year, but Net margin improved due to reduced special losses. ROE 5.4% (prior year 4.3%) improved by +1.1pt year-on-year driven by higher Net Income, though the absolute level remains low and capital efficiency could improve. Gross margin 53.6% (prior year 54.2%) down 0.6pt, reflecting higher raw material and energy costs and price competition. SG&A ratio 49.6% (prior year 50.1%) improved 0.5pt, indicating some cost control. Cash Quality: Operating Cash Flow (OCF) ¥15.4B is 1.83x Net Income ¥8.4B, indicating good cash realization. OCF/EBITDA (Operating Income ¥14.3B + Depreciation ¥6.2B = ¥20.5B) is 0.75x, showing somewhat weak cash conversion efficiency due to working capital changes and other adjustments. Accrual ratio (Net Income - OCF)/Total Assets is -3.6%, negative and indicating high earnings quality. Investment Efficiency: Total Asset Turnover 1.85x (Revenue ¥360.7B / Total Assets ¥194.8B) is nearly flat vs prior year 1.88x. Capital expenditures were ¥4.6B vs Depreciation ¥6.2B, CapEx/Depreciation 0.74x, indicating restrained, maintenance-focused investment rather than growth investment. Investment securities expanded to ¥5.6B (prior year ¥2.2B, +156.6%), contributing to increased financial income. Financial Soundness: Equity Ratio 79.6% (prior year 78.4%), Debt-to-Equity (debt/capital) 0.26x (prior year 0.28x), reflecting a very conservative capital structure. Current ratio 331.5% (current assets ¥115.7B / current liabilities ¥34.9B), quick ratio 320.0%—short-term liquidity is robust. Interest-bearing debt is effectively zero, and cash & deposits are ¥80.5B (41.3% of total assets), providing ample liquidity. Asset retirement obligations ¥4.0B account for roughly 10% of liabilities, indicating a material future cost for decommissioning/renewal.
Operating Cash Flow was ¥15.4B (prior year ¥17.5B, -11.7%), representing 1.83x Net Income and indicating high cash realization. Subtotal OCF (profit before tax + non-cash items) was ¥20.0B (prior year ¥21.7B), including depreciation ¥6.2B, impairment loss ¥0.5B, and loss on disposal of fixed assets ¥0.2B among non-cash adjustments. Working capital movements were modest: decrease in trade receivables ¥0.7B, increase in inventories -¥0.5B, decrease in trade payables -¥0.6B, limiting working capital impact. After income tax payments of ¥4.8B, OCF was ¥15.4B. Investing Cash Flow was -¥6.6B, including CapEx -¥4.6B, acquisition of investment securities -¥0.2B, acquisition of subsidiary shares -¥23.8B (same amount in prior year), partially offset by time deposit withdrawals ¥6.0B. CapEx/Depreciation 0.74x indicates maintenance-focused investment. Free Cash Flow (OCF + Investing CF) was ¥8.8B (prior year -¥12.1B), turning positive after the prior year’s large investments. Financing Cash Flow was -¥8.3B, mainly dividend payments of -¥8.1B. Dividend coverage by FCF is 1.09x (FCF ¥8.8B / dividends ¥8.1B), generally coverable, but the payout ratio is 118.9%, exceeding Net Income and raising structural sustainability concerns. Cash and cash equivalents at period-end were ¥80.5B (beginning ¥80.0B, +¥0.6B), maintaining ample liquidity.
Ordinary Income ¥14.7B comprises Operating Income ¥14.3B plus non-operating income ¥0.5B (Interest Received ¥0.2B, Dividends Received ¥0.1B, etc.), less non-operating expenses ¥0.0B, indicating a low dependency on non-operating income (3.4%). Temporary items include Special Losses ¥1.1B (impairment loss ¥0.5B, loss on disposal of fixed assets ¥0.2B, etc.), reduced from ¥3.2B the prior year, which contributed to higher Net Income. Profit before tax ¥13.6B less corporate taxes ¥5.5B (effective tax rate 40.5%) yields Net Income ¥8.4B; the divergence between Ordinary Income and Net Income of -43.0% is mainly due to high tax burden and special losses. OCF ¥15.4B is 1.83x Net Income, indicating high earnings quality; the accrual ratio -3.6% is favorable and earnings are being converted to cash. Comprehensive income was ¥12.6B (Net Income ¥8.4B + Other Comprehensive Income ¥4.5B), with OCI including valuation difference on available-for-sale securities ¥2.2B and actuarial gains/losses related to retirement benefits ¥2.3B—temporary gains from fair value adjustments. Core earnings are Operating Income ¥14.3B, indicating that recurring operations drive the majority of profit, though the high effective tax rate suppresses Net margin.
Full year guidance: Revenue ¥360.0B, Operating Income ¥14.0B, Ordinary Income ¥14.5B, Net Income attributable to owners of parent ¥8.0B, EPS ¥83.50. Actual results were Revenue ¥360.7B (achievement 100.2%), Operating Income ¥14.3B (101.9%), Ordinary Income ¥14.7B (101.6%), Net Income attributable to owners of parent ¥8.1B (101.4%), slightly exceeding conservative guidance. Revenue beat guidance by +0.2%, Operating Income +1.9%, Ordinary Income +1.6%, Net Income +1.4%; the reduction in special losses and higher financial income contributed to the final profit beat. Year-on-year, the plan had targeted Revenue -0.2%, Operating Income -1.9%, Ordinary Income -1.6%; actuals were Revenue -0.1%, Operating Income -4.9%, Ordinary Income -4.2%—operating declines exceeded the plan, but Net Income outperformed due to lower special losses (+18.4% YoY), exceeding expectations.
Year-end dividend is ¥85, bringing total annual dividend to ¥85 (interim ¥0). Payout Ratio is 118.9% (total dividends ¥8.1B / Net Income attributable to owners of parent ¥6.8B) and exceeds Net Income, indicating dividends were funded by internal reserves. Dividend FCF coverage is 1.09x (FCF ¥8.8B / dividends ¥8.1B), so dividends are generally covered by this year’s FCF, but a payout ratio above 100% suggests that sustaining payouts structurally requires strengthening earnings. Cash & deposits ¥80.5B provide ample short-term liquidity to support payments, but to maintain dividends sustainably the company needs to improve operating margin and Net margin. No share buybacks were implemented; shareholder returns were made solely through dividends.
Profitability deterioration risk in Prepared Foods, Food Products, and Restaurant segments: Prepared Foods Operating Income was -21.8% YoY, Food Products -30.8%, and Restaurants turned to a loss, indicating substantially lower profitability outside the core Meat business. If delay in passing on raw material and energy cost increases or deterioration in manufacturing costs continues, the company-wide Operating margin of 4.0% could decline further. Prepared Foods accounts for 35.6% of revenues and has high profit sensitivity, so delayed gross margin recovery could significantly impact consolidated performance.
High tax burden suppressing Net margin: Effective tax rate 40.5% results in corporate taxes of ¥5.5B on profit before tax ¥13.6B, leaving Net margin at 2.3%. A tax burden factor of 0.595 (Net Income / Profit before tax) structurally constrains ROE of 5.4%; without tax optimization or better utilization of deferred tax assets, capital efficiency improvements will be limited.
Risk of declining retained earnings due to payout ratio above 100%: Payout Ratio 118.9% exceeds Net Income and led to a reduction of retained earnings by ¥0.3B this period. Although cash & deposits of ¥80.5B provide ample liquidity, sustained low profitability (Operating margin 4.0%, Net margin 2.3%) may force continued use of reserves to maintain dividends, constraining future growth investment and financial flexibility. Asset retirement obligations ¥4.0B and other future fixed costs also warrant caution; strengthening the earnings base is urgent.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 4.0% | 5.0% (3.3%–8.4%) | -1.0pt |
| Net Margin | 2.3% | 3.2% (1.9%–6.6%) | -0.9pt |
Profitability is below the industry median, indicating significant room for improvement in operating and net margins.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | -0.1% | 5.4% (1.0%–8.6%) | -5.5pt |
Revenue growth materially lags the industry median; top-line expansion is a key challenge.
※Source: Company compilation
While the Meat Business led with Operating Income +31.3%, Prepared Foods -21.8%, Food Products -30.8%, and Restaurants turning to loss highlight material deterioration outside meat. The company-wide Operating margin of 4.0% is 1.0pt below the industry median of 5.0%, making improvements in pricing policy, manufacturing cost reduction, and selective focus on loss-making operations a priority for the next period.
OCF is 1.83x Net Income, indicating high quality earnings, but OCF/EBITDA is 0.75x and cash conversion efficiency could improve. CapEx/Depreciation 0.74x indicates maintenance-focused investment; shifting toward growth investment while maintaining cash generation will be key.
Payout Ratio 118.9% and FCF coverage 1.09x mean dividends are largely covered but exceed Net Income. Cash & deposits ¥80.5B and a healthy balance sheet mitigate short-term concerns, but sustained low profitability (Operating margin 4.0%, Net margin 2.3%) could challenge the balance between dividend sustainability and growth investment. The high effective tax rate of 40.5% suppresses ROE 5.4%; tax optimization and profitability improvement are needed to enhance capital efficiency.
This report was auto-generated by AI analyzing XBRL financial statement data. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are reference information compiled by the Company based on public financial disclosures. Investment decisions are your own responsibility; consult a professional advisor as needed.
These are mechanically computed values based on a residual income model. They are not a forecast of market prices or a recommendation of any investment action, and do not predict or guarantee future share prices. Historical values are computed retrospectively using current guidance-achievement statistics.