Asahi Group Holdings,Ltd. FY2026 Q1 Earnings Report

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Executive Summary

The first quarter of FY2026 saw higher revenue but lower profit, with the key issue being the pressure on profitability from the increase in selling, general and administrative expenses. Revenue was ¥647.12B (+2.6% year on year), Operating Income was ¥32.89B (down 3.1%), Profit Before Tax was ¥29.96B (down 5.8%), and Profit for the Quarter Attributable to Owners of the Parent was ¥21.43B (down 0.4%). Although the gross margin improved to 36.0% from 35.4% in the same period of the previous year, the SG&A ratio increased to 30.6% from 29.4%, causing the operating margin to decline to 5.1% from 5.4%. By region, Asia Pacific drove higher revenue and profit, while the significant decline in profit in Japan and East Asia weighed on consolidated performance.

Factors Affecting Performance

【Revenue】Revenue increased 2.6% year on year to ¥647.12B. By region, Asia Pacific and Europe continued to achieve double-digit growth, with revenue of ¥206.76B (+15.8%) and ¥154.26B (+11.2%), respectively, while the core Japan and East Asia region recorded a 9.6% decline to ¥277.83B. The increase in overseas revenue offset the decline in domestic revenue, resulting in only modest growth on a consolidated basis.

【Profit and Loss】Operating Income was ¥32.89B (down 3.1%), as the approximately 120bp increase in the SG&A ratio offset the 64bp improvement in the gross margin. By segment, Operating Income in Japan and East Asia deteriorated significantly to ¥15.74B (down 34.8%, margin of 5.7%), while Europe recorded ¥0.45B, improving from ¥0.15B in the previous year, although its margin remained low at 0.3%. Asia Pacific improved to ¥16.34B (+29.5%, margin of 7.9%), making the largest contribution to consolidated profit. Profit Before Tax was ¥29.96B (down 5.8%), primarily due to financial expenses of ¥12.08B exceeding financial income of ¥9.43B. Profit Attributable to Owners of the Parent was ¥21.43B (down 0.4%), supported by a decline in income taxes and other taxes, which amounted to ¥7.97B compared with ¥10.09B in the same period of the previous year. Overall, the Company recorded higher revenue but lower profit, primarily due to deterioration in volume and mix in Japan and East Asia and an increase in company-wide SG&A expenses.

Segment Analysis

By segment profit, Japan and East Asia recorded a significant decline to ¥15.74B (¥24.15B in the same period of the previous year, down 34.8%), with the margin declining from 7.7% to 5.7%. Asia Pacific increased 29.5% to ¥16.34B, and its margin improved from 7.1% to 7.9%, making it the largest contributor to consolidated Operating Income. Europe expanded its profit from ¥0.15B in the previous year to ¥0.45B, but its margin remained at 0.3%, indicating that profitability continues to be low. The regional revenue mix was 42.9% for Japan and East Asia, 31.9% for Asia Pacific, and 23.8% for Europe. The proportion of Japan and East Asia declined from 48.8% in the same period of the previous year, while the overseas proportion increased. This change in composition indicates that the sources of consolidated earnings are gradually shifting from domestic to overseas markets.

Key Financial Metrics

【Profitability】The operating margin was 5.1%, declining approximately 30bp from 5.4% in the same period of the previous year, as the improvement in the gross margin to 36.0% from 35.4% was offset by the increase in the SG&A ratio to 30.6% from 29.4%. The net profit margin was 3.3%.

【Cash Flow Quality】Operating Cash Flow (OCF) of ¥50.42B was 2.35 times Profit Attributable to Owners of the Parent of ¥21.43B, indicating strong cash generation relative to accounting profit. However, attention is warranted because working capital movements, including a ¥57.74B decrease in trade receivables and an increase in unpaid liquor tax, contributed to the improvement.

【Investment Efficiency】ROE was 0.7% on a quarterly basis. Even on an annualized basis, the asset-intensive structure, with fixed assets accounting for 84.5% of total assets, constrains capital efficiency. The fact that goodwill and intangible assets account for 61.9% of total assets is an important consideration when assessing the monetization of invested capital.

【Financial Soundness】The Equity Ratio improved to 51.0% from 49.8% in the same period of the previous year. Current assets of ¥925.37B compared with current liabilities of ¥1,707.88B resulted in a current ratio of only 54.2%. Cash and cash equivalents amounted to ¥74.57B, a decline of ¥81.81B from the end of the previous fiscal year, primarily due to the redemption of ¥100.00B in bonds.

Cash Flow Analysis

Operating Cash Flow improved substantially to ¥50.42B from negative ¥151.53B in the same period of the previous year. In addition to earnings capacity represented by Profit Before Tax of ¥29.96B plus depreciation and amortization of ¥41.40B, the ¥57.74B decrease in trade receivables and ¥43.95B increase in unpaid liquor tax contributed to cash inflows. These were partly offset by a ¥15.06B increase in inventories and a ¥49.41B decrease in trade payables, both of which were sources of cash outflows. Investing Cash Flow was negative ¥32.21B, primarily reflecting capital expenditures of ¥31.50B, resulting in positive free cash flow of ¥18.21B. Financing Cash Flow showed a substantial net outflow of negative ¥99.98B, primarily due to the redemption of ¥100.00B in bonds and dividend payments of ¥38.03B, partly offset by a ¥66.27B increase in short-term borrowings. As a result, cash and cash equivalents declined by ¥81.81B from the beginning of the period to ¥74.57B. This was driven primarily by the one-off funding requirement associated with bond redemption rather than a structural decline in recurring earnings capacity.

Quality of Earnings

The difference between Profit Before Tax of ¥29.96B and Profit Attributable to Owners of the Parent of ¥21.43B was attributable to income taxes and other taxes of ¥7.97B and profit attributable to non-controlling interests of ¥0.56B. No special one-time profit or loss items were identified. Financial expenses of ¥12.08B exceeded financial income of ¥9.43B, and this structure continued to weigh on Profit Before Tax. Operating Cash Flow of ¥50.42B exceeded accounting profit, and accruals, as represented by the divergence between accounting profit and OCF, were negative; accordingly, the cash backing of earnings can be assessed as strong. However, the improvement in OCF included contributions from working capital movements such as the decline in trade receivables and increase in unpaid liquor tax, which should be evaluated separately from ordinary earnings capacity. Comprehensive income was ¥87.41B, including ¥86.94B attributable to owners of the parent, substantially exceeding Net Income of ¥21.43B. The primary factor was the foreign currency translation adjustment of +¥55.76B for foreign operations, reflecting yen depreciation. This divergence resulted from a non-recurring foreign currency translation item and should be understood separately from Net Income, which reflects core earnings capacity.

Earnings Forecast and Guidance

Q1 progress against the full-year forecast was 20.1% for Revenue, based on a forecast of ¥3,220.0B; 11.1% for Operating Income, based on a forecast of ¥297.00B; and 11.0% for Profit Attributable to Owners of the Parent, based on a forecast of ¥194.00B. Although these figures are below the simple benchmark of one-quarter, or 25%, the alcoholic beverages and soft drinks businesses are seasonal, with demand concentrated in summer. The Company has also explicitly stated this as an assumption underlying its earnings forecast. Nevertheless, the full-year Operating Income forecast incorporates substantial profit growth of +59.8% year on year. Given that Q1 was effectively a decline in profit, improvements in sales volume, unit prices, and product mix from the summer onward, as well as the extent to which SG&A expenses are absorbed, will be critical to achieving the full-year forecast. No revisions were made to the earnings or dividend forecasts during the quarter.

Shareholder Returns

The full-year dividend forecast is ¥57.00 per share. Based on an annual dividend amount of approximately ¥83.37B, calculated using the full-year forecast of Profit Attributable to Owners of the Parent of ¥194.00B and the period-average number of shares outstanding of 1.463B shares, the forecast Payout Ratio is approximately 43%. This is a dividend-only Payout Ratio and does not include share repurchases. Share repurchases during the quarter were virtually zero (negative ¥0.00B), and no additional share repurchases were conducted that would increase the Total Return Ratio. Dividend payments during the quarter were ¥38.03B, exceeding free cash flow of ¥18.21B for the same period. However, given the business characteristics of OCF fluctuating due to its concentration in the summer season, comparison with cash generation capacity on a full-year basis is important. No revision was made to the dividend forecast.

Risk Factors

1. Deterioration in domestic business profitability: Revenue in Japan and East Asia declined 9.6% year on year, while segment profit declined 34.8%. The margin also decreased from 7.7% to 5.7%. Given the significant impact on consolidated profit, trends in demand, pricing, and product mix will continue to warrant close monitoring.

2. Liquidity and maturity profile: The current ratio was 54.2% (current assets of ¥925.37B / current liabilities of ¥1,707.88B), resulting in negative working capital. Total bonds and borrowings amounted to ¥1,589.53B. Interest coverage based on Q1 Operating Income was only approximately 2.7 times, indicating relatively high sensitivity to refinancing and interest rate fluctuations.

3. Concentration of goodwill and intangible assets: Goodwill and intangible assets amounted to ¥3,707.28B, accounting for 61.9% of total assets and increasing ¥49.38B from the end of the previous fiscal year. The Company has a high degree of dependence on brand value acquired through acquisitions, and the risk of impairment if profitability falls below expectations remains an ongoing area of focus.

Industry Benchmark (For Reference; Compiled by the Company)

Key Earnings Highlights

1. Although the gross margin improved to 36.0%, the increase in the SG&A ratio to 30.6% from 29.4% in the same period of the previous year offset the improvement, causing the operating margin to decline to 5.1%. The structure of lower Operating Income despite higher revenue warrants attention from a cost absorption perspective.

2. While higher revenue and profit in Asia Pacific (revenue +15.8%, profit +29.5%) supported consolidated profit, the core Japan and East Asia region recorded a significant decline in profit, creating a clear divergence in regional earnings performance.

3. Operating Cash Flow of ¥50.42B was 2.35 times Profit Attributable to Owners of the Parent, indicating strong cash conversion of accounting profit. However, cash balances declined significantly from the end of the previous fiscal year due to the redemption of ¥100.00B in bonds, making full-year cash management trends an important point to monitor.

Theoretical Share Price (Reference Value)

Sensitivity: ¥1,902–¥2,012 at ±1% for the cost of equity, and ¥1,951–¥1,959 at ±0.1 for ω.

Notes:

• As forecast ROE is below the cost of equity, the theoretical value is below book value per share.
• Net assets as of the end of the quarter are used; there is a timing difference relative to the full-year forecast.

(Calculation model: Residual Income Model (Ohlson type; explicit five-year fade) / Interest rate reference month: 2026-07 / These are mechanically calculated values based solely on publicly disclosed data and do not constitute a forecast of the market share price, a recommendation of any specific investment action, or a prediction or guarantee of future share prices.)

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This report is an earnings analysis document automatically generated by AI based on XBRL earnings release data. It does not recommend investment in any specific security. The industry benchmark is reference information compiled by the Company based on publicly disclosed earnings data. Investment decisions should be made at your own discretion and responsibility, after consulting a professional adviser where appropriate.

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AI Financial Analysis

Executive Summary

FY2026 Q1 was a mixed start: revenue growth remained positive, but operating profit and profit attributable to owners declined modestly as SG&A growth outpaced sales. Revenue increased 2.6% YoY to ¥647.1bn. Gross profit rose 4.5% YoY to ¥233.0bn, materially ahead of sales growth. The gross margin expanded by 60bp YoY to 36.0%, indicating that pricing, mix, procurement, or production-cost management supported gross profitability. SG&A expenses, however, increased 6.8% YoY to ¥197.9bn, faster than revenue and gross profit. Consequently, operating income fell 3.1% YoY to ¥32.9bn. The operating margin compressed by approximately 30bp YoY to 5.1%. Net income attributable to owners declined 0.4% YoY to ¥21.4bn, while consolidated net income increased 1.3% to ¥22.0bn because non-controlling interests rose. The net margin declined by around 10bp to 3.3%. Finance income increased to ¥9.4bn, but finance costs rose more sharply to ¥12.1bn, reducing the interest burden to 0.911 from approximately 0.937 in the prior-year quarter. Operating cash flow recovered to a positive ¥50.4bn from a ¥151.5bn outflow a year earlier, producing an OCF/net income ratio of 2.35x. This cash conversion was supported substantially by a ¥57.7bn reduction in trade receivables, although inventory increased by ¥15.1bn and trade payables declined by ¥49.4bn. Free cash flow was positive at ¥18.2bn after ¥31.5bn of capital expenditures, but did not cover ¥38.0bn of dividends paid during the quarter. The company redeemed ¥100.0bn of bonds and drew ¥66.3bn of short-term borrowings, contributing to an ¥81.8bn decline in quarter-end cash to ¥74.6bn. Segment performance was polarized: Asia Pacific expanded strongly, Europe improved from a low base, and Japan/East Asia saw lower revenue and a substantial segment-profit decline. Q1 operating-income progress was only 11.1% of the FY2026 forecast, below the 25% simple quarterly reference point; management notes that alcoholic-beverage and soft-drink demand is concentrated in summer, so Q1 is structurally seasonally weak. The full-year forecast therefore requires substantial margin recovery through the peak-demand periods, particularly in Japan/East Asia. No revision was made to either earnings or dividend guidance.

Profitability Analysis

Reported Q1 annualized ROE is 2.8%, based on the supplied DuPont decomposition of a 3.3% net profit margin, 0.433x annualized asset turnover, and 1.96x financial leverage. The principal constraint on returns is low underlying profitability rather than insufficient leverage: the 3.3% net margin and 5.1% EBIT margin remain modest for a global branded beverage group. Annualized asset turnover of 0.433x is also constrained by the asset base, including ¥3,707.3bn of goodwill and intangible assets, equal to 62.0% of total assets. Gross-margin expansion to 36.0% from approximately 35.4% was a favorable development and suggests gross-level pricing/mix resilience despite food-and-beverage commodity, packaging, energy, and foreign-exchange exposures. The main negative change was operating leverage: SG&A grew 6.8% versus 2.6% sales growth, absorbing the ¥10.0bn gross-profit increase and resulting in a ¥1.1bn decline in operating income. Other operating income increased by ¥1.6bn YoY, while other operating expense was broadly stable, providing partial support but not offsetting SG&A pressure. The tax burden was 0.715, consistent with a 26.6% effective tax rate and within a normal range. The interest burden of 0.911 remains above the 0.90 low-debt reference threshold, but declined as net finance cost widened to ¥2.7bn from ¥2.0bn. ROIC of 3.2% is below the 5% warning threshold. This is a material capital-efficiency concern because the group carries a large acquired-intangible asset base and its return generation is currently below a level that would ordinarily provide a comfortable spread over the cost of capital. Sustained gross-margin gains, disciplined SG&A, and improved returns from the acquired brand portfolio are required to improve capital efficiency.

Growth Assessment

Revenue growth of 2.6% YoY was led by Asia Pacific and Europe, while Japan/East Asia contracted. Asia Pacific external revenue rose 15.7% YoY to ¥206.8bn and segment profit increased 29.5% to ¥16.3bn, lifting segment margin to 7.9% from 7.0%. Europe external revenue increased 11.2% to ¥154.3bn, and segment profit improved to ¥4.5bn from ¥1.5bn; however, the segment margin remains low at 0.3%. Japan/East Asia external revenue fell 9.6% to ¥277.8bn and segment profit declined 34.8% to ¥15.7bn, reducing its segment margin to 5.6% from 7.9%. Japan/East Asia remains the core business by segment-profit contribution, accounting for 46.2% of aggregate segment profit before corporate costs, but its Q1 performance is the principal earnings headwind. Asia Pacific accounted for 48.0% of aggregate segment profit before corporate costs and was the largest contributor in the quarter, slightly ahead of the core Japan/East Asia business. Unallocated corporate costs improved by ¥1.5bn YoY to ¥5.9bn, helping narrow the consolidated impact of weaker Japanese profitability. The FY2026 forecast calls for revenue of ¥3,220.0bn, operating income of ¥297.0bn, and net income attributable to owners of ¥194.0bn. Q1 revenue represents 20.1% of the full-year revenue forecast, 11.1% of operating-income guidance, and 11.0% of attributable-net-income guidance. The profit progress rates are more than 10 percentage points below a simple 25% quarterly reference point, although the summer concentration of beverage and alcohol demand makes Q1 progress mechanically lower than a linear run rate. The outlook is therefore highly dependent on seasonal volume realization, continued Asia Pacific momentum, European margin improvement, and recovery in Japan/East Asia. The 2/10 consistency score indicates that recent growth delivery has been uneven despite a stable overall margin trend.

Financial Health

The equity ratio improved to 51.0% from 49.8% at the prior-year quarter, and total equity increased 1.5% YoY to ¥3,054.8bn. The reported debt-to-equity ratio is 0.96x, below the 2.0x aggressive-financing warning threshold. Nevertheless, liquidity is tight on a current-ratio basis: current assets of ¥925.4bn divided by current liabilities of ¥1,707.9bn implies a current ratio of 0.54x, well below 1.0x. This represents a maturity-mismatch risk because current liabilities exceed current assets by ¥782.5bn. Current bonds and borrowings were ¥786.5bn, representing a substantial refinancing and liquidity-management requirement relative to ¥74.6bn of cash and equivalents at quarter-end. During Q1, the group redeemed ¥100.0bn of bonds and reduced long-term borrowings by ¥19.2bn, while increasing short-term borrowings by ¥66.3bn. This indicates active liability management but also a partial shift toward short-term funding. Total bonds and borrowings were ¥1,589.5bn, or roughly 52.0% of total equity. Other financial liabilities totaled ¥192.8bn, while lease payments were ¥7.9bn during the quarter, adding to fixed financial commitments. Goodwill and intangible assets totaled ¥3,707.3bn, or 62.0% of assets and 121.4% of equity. The high acquired-intangible concentration makes balance-sheet value and future returns sensitive to the ongoing performance of acquired brands and cash-generating units. Deferred tax liabilities of ¥250.3bn also exceed deferred tax assets of ¥41.5bn, consistent with a balance sheet carrying meaningful valuation and acquisition-related differences.

Notable B/S Changes

Cash and equivalents: -¥818.1bn QoQ to ¥745.7bn, reflecting bond redemption, debt repayment, dividends, investment outflows, and a net cash decrease during Q1. Goodwill and intangible assets: +¥493.8bn QoQ to ¥3,707.3bn (+1.3%), increasing the already substantial acquired-intangible concentration to 62.0% of total assets; future cash-flow delivery and impairment indicators remain important. Current assets: -¥1,023.5bn QoQ to ¥925.4bn (-10.0%), led by lower cash and receivables; this contributed to a 0.54x current ratio. Current bonds and borrowings: -¥523.2bn QoQ to ¥786.5bn (-6.2%), while noncurrent bonds and borrowings were broadly stable at ¥803.1bn; Q1 funding actions included redemption of ¥100.0bn of bonds and increased short-term borrowings. Other components of equity: +¥636.6bn QoQ to ¥1,329.8bn (+5.0%), principally supported by ¥557.6bn of foreign-currency translation gains and contributing to the increase in the equity ratio to 51.0%.

Cash Flow Quality

Cash-flow quality was strong in the reported quarter, with operating cash flow of ¥50.4bn exceeding consolidated net income of ¥22.0bn by 2.35x. The accruals ratio of -0.5% also indicates favorable cash realization of reported earnings. Cash generation improved sharply from the prior-year Q1 operating cash outflow of ¥151.5bn. The key source of the improvement was a ¥57.7bn reduction in trade receivables, compared with a ¥9.4bn reduction in the prior-year quarter. This receivables release should be interpreted alongside the quality alert that DSO is 63 days, above the 60-day threshold; the absolute collection improvement is positive, but the outstanding collection period remains elevated. Inventory increased by ¥15.1bn and inventory days were 71 days, above the 60-day processed-food benchmark. The inventory build may reflect seasonal preparation for the summer demand period, but it raises the risk of working-capital absorption if sell-through or demand is weaker than expected. Trade payables declined by ¥49.4bn, which was a significant use of cash, while changes in unpaid liquor tax contributed a ¥44.0bn cash inflow. These offsetting working-capital movements mean the positive OCF should not be extrapolated mechanically as a normalized quarterly run rate. Capital expenditures of ¥31.5bn were broadly lower YoY, and FCF was positive at ¥18.2bn. However, FCF covered only 47.9% of dividends paid of ¥38.0bn in Q1. Cash and equivalents declined by ¥81.8bn during the quarter, reflecting investment, dividends, bond redemption, and long-term debt repayment despite positive OCF.

Dividend Sustainability

The FY2026 dividend forecast is ¥57 per share, unchanged from guidance. Against forecast EPS of ¥129.71, the implied full-year dividend payout ratio is 43.9%, below the 60% sustainability benchmark. No share repurchases were recorded in Q1, so the relevant distribution measure is the dividend payout ratio rather than a total return ratio. Q1 dividends paid were ¥38.0bn, exceeding Q1 FCF of ¥18.2bn by ¥19.8bn. Quarterly FCF coverage alone is therefore insufficient, but the seasonal concentration of earnings and cash generation means full-year coverage is more informative than Q1 coverage. The forecast payout appears supportable if the company delivers its full-year earnings target and converts second-half seasonal profits into cash. Liquidity management remains important, however, because quarter-end cash was ¥74.6bn and the current ratio was 0.54x. The absence of a dividend revision signals management confidence in the current distribution framework, while the large bond redemption and short-term funding use increase the importance of achieving the planned profit recovery.

Risk Assessment

Business risks include Japan/East Asia execution risk: external revenue declined 9.6% YoY and segment profit fell 34.8% YoY, materially weakening the core business's Q1 profitability., Seasonality risk: alcohol and beverage demand is concentrated in summer, making the FY2026 earnings plan heavily dependent on peak-season weather, consumption, distribution, and promotional execution., Commodity, packaging, energy, and foreign-exchange exposure: gross-margin expansion demonstrates current resilience, but these inputs can reverse margin gains if price pass-through lags., Food-and-beverage inventory risk: inventory days of 71 exceed the 60-day benchmark; seasonal stock-building may be appropriate, but lower-than-planned sell-through could cause working-capital pressure and inventory valuation risk., Brand portfolio and impairment risk: goodwill and intangible assets of ¥3,707.3bn equal 62.0% of assets and 121.4% of equity, making value retention dependent on acquired brands delivering their expected cash flows., Food safety, product-quality, labeling, and recall risk remains material for a global alcohol and non-alcohol beverage manufacturer..

Financial risks include Liquidity risk: the current ratio is 0.54x, explicitly below the 1.0x warning threshold, with current liabilities exceeding current assets by ¥782.5bn., Refinancing and maturity-mismatch risk: current bonds and borrowings were ¥786.5bn against cash of ¥74.6bn; Q1 included a ¥100.0bn bond redemption and a ¥66.3bn increase in short-term borrowings., Capital-efficiency risk: ROIC of 3.2% is below the 5% warning threshold, indicating that return generation is weak relative to the capital invested in the group., Working-capital risk: DSO of 63 days and inventory days of 71 are both above their respective 60-day alerts, which can constrain cash conversion if receivables collection slows or inventories continue to build., Interest-cost risk: finance costs increased 30.0% YoY to ¥12.1bn, while the interest burden weakened to 0.911..

Key concerns include The primary near-term issue is the divergence between improving gross margin and declining operating profit, caused by SG&A rising 6.8% versus 2.6% revenue growth., Q1 operating-income progress of 11.1% versus the FY forecast is substantially below a simple 25% quarterly reference point, increasing dependence on seasonal earnings acceleration., The high receivable-days alert reflects collection-cycle risk. The Q1 receivables reduction supported OCF, but the 63-day DSO remains above the stated threshold., The high inventory-days alert reflects 71 days of inventory, above the processed-food benchmark. This may support summer sales, but should be monitored for sell-through and cash conversion., The capital-efficiency alert reflects 3.2% ROIC, which is particularly important given the acquired-intangible-heavy asset base..

Investment Implications

Key takeaways include Revenue growth and a 60bp gross-margin expansion show underlying commercial resilience, but higher SG&A prevented that improvement from reaching operating profit., Asia Pacific is the strongest Q1 growth and earnings contributor, while Japan/East Asia is the material drag on consolidated performance., The group generated positive OCF and FCF in Q1, but dividend cash outflows exceeded FCF and quarter-end liquidity remains constrained by a 0.54x current ratio., A 3.2% ROIC and ¥3,707.3bn goodwill-and-intangible balance emphasize the need for stronger earnings conversion from the acquired global brand platform., Full-year delivery requires significant seasonal improvement after Q1 operating-income progress of 11.1%..

Metrics to watch include Japan/East Asia revenue growth, segment margin, and recovery in segment profit, Asia Pacific segment-profit growth and margin sustainability, Consolidated SG&A growth relative to revenue growth, Operating-margin recovery from 5.1%, DSO relative to 63 days and inventory days relative to 71 days, Operating cash flow excluding timing effects from receivables, payables, and liquor-tax movements, Current bonds and borrowings, cash balances, and the current ratio, ROIC progression from 3.2%, Goodwill and intangible asset balance, impairment indicators, and returns from acquired businesses, Progress against FY2026 operating-income guidance of ¥297.0bn and attributable-net-income guidance of ¥194.0bn.

Regarding relative positioning, The group combines a healthy 36.0% gross margin and broad geographic diversification with comparatively modest Q1 operating profitability, low 3.2% ROIC, an intangible-heavy balance sheet, and tighter short-term liquidity than would be desirable. Asia Pacific provides the strongest current momentum, whereas Japan/East Asia requires operational recovery for the group to convert its brand scale into higher returns.