Megmilk Snow Brand Co., Ltd.

Business Details

This segment manufactures and sells dairy products (Cheese, Butter, powdered milk, etc.), fats/oils, functional foods, and powdered milk. It is centered primarily on Snow Brand Megmilk Co., Ltd., and includes Snow Brand Bean Stalk Co., Ltd. (powdered milk), Chesco Co., Ltd. (Cheese), Konan Yushi Co., Ltd. (fats/oils), and overseas subsidiaries (SNOW BRAND AUSTRALIA PTY. LTD., etc.). With domestic retail and food-service channels as its primary customers, it is the largest segment, accounting for approximately 44% of consolidated net sales.

Recent Overview

Butter performed well due to price revision effects, but decreased Cheese volume weighed on results. Recorded impairment loss of 2,189 million yen at the Okoppe Plant

In the Dairy Products segment for FY2026 (ending March 2026), net sales were 268,428 million yen (up 1.9% year on year) and operating income was 10,515 million yen (up 1.1% year on year), representing increased sales and income. Butter exceeded the prior year due to price revisions and resilient demand, and "Sakeru Cheese" recorded its highest-ever sales, but the Cheese category overall fell below the prior year due to reduced volume from price revisions. In the Dairy Products segment, the decision was made on November 14, 2025 to end production at the Okoppe Plant (Okoppe-cho, Monbetsu-gun, Hokkaido), and an impairment loss of 2,154 million yen was recorded as an extraordinary loss.

Key Products

Growth Drivers

• Increased sales in the Butter & Fats/Oils category through the penetration of price revisions
• Strengthened promotional activities for flagship products such as "Sakeru Cheese" in the Cheese category
• Improved production efficiency through the reorganization of the Kanto-region production structure under Next Design 2030 (consolidation into the Ebina and Noda plants, investment of approximately ¥10.9 billion, operations scheduled to begin in the first half of FY2028)
• Strengthened overseas expansion (SNOW BRAND AUSTRALIA, Taiwan Snow Brand, PT. MEGMILK SNOW BRAND INDONESIA, etc.)
• Growth in sales of functional ingredients to overseas markets

Risks

• Greater-than-expected decline in sales volume due to price revisions (evident in Cheese, etc.)
• Pressure of increased fixed costs due to rising raw material prices and logistics costs
• Recording of impairment loss (2,154 million yen) due to the termination of production at the Okoppe Plant, and costs arising from the reorganization of the production structure, including the termination of production at the Kawagoe Plant
• Raw material procurement risk due to declining domestic raw milk production volume
• Continuation of the supply-demand imbalance issue for skim milk powder and butter