Premium Water Holdings,Inc.
2588・Standard Market・Foods
Business
Premium Water Holdings, as a holding company, has 13 consolidated subsidiaries and 9 equity-method affiliates under its umbrella, and operates a Home and Office Delivery business centered on the manufacturing and delivery of natural mineral water and the rental of water servers. The company sources and manufactures high-quality natural water from eight water sources in Gifu, Yamanashi, Hyogo, Shizuoka, Nagano, Nara, Shimane, and Kumamoto prefectures, and delivers it directly to households and offices nationwide using a one-way system (no empty bottle collection required). Its main customers are general households and small and medium-sized offices, and the number of contracts held reached 1.82 million as of the end of FY2026 (ending March 2026). The Home and Office Delivery business accounts for over 90% of revenue, effectively functioning as a single-business company.
Business Model
Customers receive a water server free of charge (or through a distribution agency) and subscribe to regular deliveries of 12-liter bottles of natural mineral water. Revenue consists of bottle sales (direct, through agents, through distributors, and OEM), server rental fees, and other ancillary services. Water server rental revenue for FY2026 (ending March 2026) expanded to ¥17,329 million (up 23.3% year on year), reflecting a structure in which enhanced provision of long-term contract plans works to suppress cancellations and raise customer unit spend.
Company Strengths
As of the end of FY2026 (ending March 2026), the number of contracts in force reached 1.82 million, and the company has built a stable monthly revenue base through enhanced provision of long-term contract plans and initiatives to improve existing customer retention rates. Since surpassing 1 million contracts in March 2020, the company has added approximately 820,000 contracts over roughly six years, confirming the continued expansion of its customer base as a proven track record.
Raw water is procured from 8 water sourcing locations nationwide, and the in-house production rate for PET bottles has reached 100%. At the three plants in Gifu Kitagata, Fujiyoshida, and Asago, groundwater is drawn from the company's own wells, giving it a competitive advantage in sanitation management, cost, and environmental impact. FSSC22000 certification has been obtained at multiple plants, institutionally ensuring the quality assurance system.
As a result of ongoing efforts to stabilize delivery costs through the establishment of a proprietary logistics network and to reduce manufacturing costs through improved plant equipment utilization rates, operating profit expanded approximately 2.1-fold from ¥6,097 million in FY2022 to ¥12,647 million in FY2026. Combined with improved efficiency in customer acquisition costs, the operating profit margin improved from 8.9% in FY2022 to 15.7% in FY2026.
ENVALITH's Perspective
Performance Trend
Revenue grew from ¥68,452 million in FY2022 to a peak of ¥80,578 million in FY2024, then declined to ¥76,895 million in FY2025, before recovering to ¥80,323 million in FY2026 (up 4.5% year on year). Operating profit rose for a fifth consecutive period to ¥12,647 million (up 10.1% year on year), with the operating margin improving to 15.7%. Profit attributable to owners of parent increased substantially to ¥8,450 million (up 50.1% year on year), but this was aided by an improvement in equity-method investment gains/losses (from ¥-846 million in the prior period to ¥+115 million in the current period) and a temporary boost from a revision to the depreciation period for assets related to water-purifying water servers (contributing ¥2,011 million to operating profit), points that warrant attention. As an external factor, rising prices and higher personnel expenses continue to act as a drag on costs.
Growth Strategy
Sustainable growth driven by the trinity of net policy growth, cost internalization, and strengthened shareholder returns
The company aims to increase new contracts through diverse sales methods including demonstration sales, telemarketing, and web channels, while enhancing long-term contract plans and expanding ancillary services to improve the retention rate of existing customers. Starting from 1.82 million contracts at the end of FY2026 (ending March 2026), the company will maintain net growth and expand its stable subscription revenue base.
The company continues to promote reductions in manufacturing costs through improved factory equipment utilization rates and stabilization of delivery costs through the development of a proprietary logistics network. In FY2026 (ending March 2026), cost of sales decreased year on year, reflecting the effects of cost internalization. The company expects continued profit growth in FY2027 (ending March 2027) driven by ongoing manufacturing and logistics cost reduction effects.
The annual dividend for FY2026 (ending March 2026) was increased to ¥115 (from ¥100 in the previous period), with a payout ratio of 40.7%. A dividend of ¥120 is planned for FY2027 (ending March 2027). As a subsequent event, the company has also resolved to repurchase up to 125,000 shares of common stock with an upper limit of ¥500 million, and plans to submit the introduction of a performance-linked stock compensation plan (BBT-RS) to the general shareholders meeting.
The plan aims to clarify the linkage between the compensation of directors and other officers and business performance and share value, thereby increasing motivation to contribute to medium- to long-term performance improvement and enhanced corporate value. With the aim of responding to the Corporate Governance Code and establishing a new incentive framework, the proposal is scheduled to be submitted to the ordinary general shareholders meeting to be held on June 24, 2026. The trust agreement is scheduled to be concluded in August 2026.
Last updated: July 19, 2026