ENVALITH
日東富士製粉株式会社 logo

NITTO FUJI FLOUR MILLING CO.,LTD.

2003・Standard Market・Foods

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日東富士製粉株式会社 logo
NITTO FUJI FLOUR MILLING CO.,LTD.2003

Business

Nitto Fuji Flour Milling was founded in 1914, and reached its current form in 2006 through the merger of Nitto Flour Milling and Fuji Flour Milling, making it a major flour milling specialist. Its core Flour Milling and Food Products business (approximately 83% of net sales) manufactures wheat flour, mixed flour, and food products, supplied to the commercial and household markets with Mitsubishi Corporation acting as distributor. The company is also pursuing synergies from making its consolidated subsidiary Masuda Flour Milling Co., Ltd. (maker of the confectionery flour brand "Takarakasa") a wholly owned subsidiary. In the restaurant business, Sawayaka Co., Ltd., the top KFC franchisee, operates stores in the Kanto and Tokai regions. The company has overseas manufacturing bases in Thailand and Vietnam, and is also expanding into the Southeast Asian mixed flour market. Consolidated net sales for FY2026 (ending March 2026) are ¥72,777 million.

Business Model

Wheat is procured as the main raw material through government-managed import wheat sold at controlled prices, and processed into wheat flour, mix flour, and other products at multiple domestic plants. Based on the general agency agreement concluded with Mitsubishi Corporation in 1964, the company sells to the commercial-use and household-use markets by leveraging Mitsubishi Corporation's value chain. Raw material costs move in line with revisions to the government selling price, and profitability is secured through cost pass-through. The restaurant business earns revenue from KFC franchise fee income and store sales.

Company Strengths

Leveraging the general agency agreement concluded with Mitsubishi Corporation in 1964, the company utilizes an integrated value chain spanning from upstream (raw material procurement) to downstream (retail). In FY2026 (ending March 2026), sales to Mitsubishi Corporation reached ¥10,824 million (14.9% of total sales results), securing a stable sales channel.

In 2018, the company made Masuda Seifun Sho Co., Ltd. a wholly owned subsidiary, acquiring the confectionery flour brand "Takaragasa". Synergies are being pursued across five areas—procurement, manufacturing, sales, and R&D—achieving cost reductions through joint material purchasing, manufacturing efficiency improvements at optimally located plants, and expanded sales in the western Japan market. Development of new high-quality products through the integration of both companies' technologies also continues.

At the end of FY2026 (ending March 2026), the equity ratio stood at 78.5%, with interest-bearing debt of ¥497 million against cash and cash equivalents of ¥11,554 million. The ratio of cash flow to interest-bearing debt was 0.1 years, maintaining a virtually debt-free management structure. Capital expenditures of ¥1,593 million were funded entirely through internal funds, and the company continued to pay an annual dividend of ¥280 under its progressive dividend policy.

ENVALITH's Perspective

Operating profit for FY2026 (ending March 2026) fell to ¥3,816 million (down 25.1% year on year), the lowest level since FY2022 (ended March 2022). Three factors occurred simultaneously: an increase in large-scale repair costs for aging equipment (continuing through FY2025–FY2026), a decline in market prices for feed-blending by-products (an external factor), and a surge in indirect costs such as sales freight charges. In the Food Service Business as well, rising personnel and food costs squeezed profit, and the operating profit margin fell to 5.2% (from 7.0% in the previous period). The timing of completion of repair works and the recovery of by-product market prices hold the key to a profit recovery.

Following revisions to the government's selling price (down 4.6% in April 2025 and 4.0% in October 2025), the company implemented price revisions for commercial-use wheat flour, resulting in sales in the Flour Milling and Food Business of ¥60,502 million, down 0.4% year on year. Meanwhile, sales volume of wheat flour remained firm, and consolidated net sales increased 0.6% year on year to ¥72,777 million, securing revenue growth. Trends in the government's selling price, as an external factor, remain a key variable for business performance going forward, and the direction of the next revision warrants continued attention.

The annual dividend per share for FY2026 (ending March 2026) is ¥280 (pre-split), with total dividends of ¥2,554 million, raising the payout ratio to 76.8% (from 71.8% in the previous period). For FY2027 (ending March 2027) as well, the company plans a progressive dividend at an effectively unchanged level (¥70 per share, adjusted for the stock split), demonstrating a strong commitment to shareholder returns. However, against net income of ¥3,319 million, total dividends of ¥2,554 million represent 77% of profit allocated to dividends, and the sustainability of this level amid continuing repair investment requires ongoing monitoring.

Growth Strategy

Converting the medium-term management plan to a Rolling Plan format, the company aims for renewed growth through four pillars: improving flour milling profitability, streamlining food service operations, expanding overseas business, and promoting DX.

Following the October 2024 recall incident involving premix products, the company strengthened its maintenance and inspection system for plant equipment. Large-scale repair works on aging equipment are underway during FY2025-FY2026 (ending March 2025 and March 2026). Upon completion of the repairs, normalization of repair cost burden and improved production efficiency through stable equipment operation are expected, which will directly contribute to the recovery of profit margins in the flour milling and food businesses.

The company is updating its "Medium-Term Management Plan 2026" announced in May 2024, taking into account the status of large-scale repairs and the future business environment, with plans to announce it shortly as the "Medium-Term Management Plan Rolling Plan." This represents a shift toward a system that agilely revises measures aimed at strengthening the earnings base and achieving sustainable growth.

In October 2025, the company transferred 66.6% of the shares of Nitto Fuji Transportation Co., Ltd. to Marzen Showa Unyu Co., Ltd., forming a joint venture as M&F Logistics Co., Ltd. Leveraging Marzen Showa Unyu's comprehensive logistics expertise, the company is promoting measures to comply with the revised Logistics Efficiency Act (reducing waiting time for loading/unloading, improving delivery efficiency). By stably capturing intra-group logistics demand through an equity-method affiliate, the company aims to improve its logistics cost structure.

The company is expanding its mix flour business for Southeast Asia through overseas subsidiaries in Thailand and Vietnam. Overseas sales in FY2026 (ending March 2026) reached ¥3,683 million (up from ¥3,468 million in the previous fiscal year), achieving increased sales. This serves as a risk diversification function against the maturing and shrinking domestic flour milling market, while positioning it as a growth engine that captures expanding food demand in Southeast Asia (an external factor).

Through the promotion of DX, the company is working on thorough labor-saving and equipment maintenance to improve production efficiency and further enhance quality standards. In the food service business as well, the company is advancing store operation efficiency, aiming to recover from earnings pressure caused by rising labor and food costs. Earnings improvement in the food service business in FY2027 (ending March 2027) is expected to play a part in the recovery of consolidated performance.

Last updated: July 19, 2026