KAGOME CO.,LTD.
2811・Prime Market・Foods
Business
Kagome Co., Ltd. was founded in 1899 and has a 127-year history as a food manufacturer specializing in vegetables and tomatoes. Domestically, the company relies on its Domestic Processed Foods Business (net sales of ¥157,324 million), which manufactures and sells vegetable beverages, seasonings, and other products, as its earnings base, while positioning its International Business (net sales of ¥129,837 million)—which spans tomato agricultural production through primary and secondary processing to sales overseas—as its growth engine. The group, comprising 39 subsidiaries and 3 affiliated companies, has built a global value chain extending from variety development and cultivation technology to processing and sales, with major customers ranging from domestic general consumers to overseas foodservice companies (seasoning manufacturers, restaurant chains, etc.).
Business Model
In the Domestic Processed Foods Business, beverages and seasonings leveraging vegetable functionality research and brand strength are sold through household, commercial, and mail order channels, securing a business profit margin of 9.9%. In the International Business, the company sells to food service companies in North America, Europe, and India through a vertically integrated BtoB model spanning variety development, primary processing (tomato paste, etc.), and secondary processing (pizza sauce, etc.). Fluctuations in the tomato paste market are the primary driver of earnings volatility, and stabilization through expansion of secondary processing and an increase in the proportion of long-term contracts is a key challenge.
Company Strengths
The Kagome brand, built over 127 years of history, has deeply permeated domestic consumers. Tomato juice, through full-scale promotion of functional health claims (blood pressure), grew net sales to approximately 2.0x FY2021 levels (an increase of approximately ¥11.8 billion) in FY2025. Vegetable Check® has cumulative measurement records exceeding 24 million times, with cumulative installations at corporations and municipalities reaching 8,400 units.
The company vertically integrates operations domestically and internationally, from variety and cultivation technology development (GARBiC) through procurement, processing, and sales. In January 2024, it made Ingomar Packing Company, LLC (at the time the world's 4th largest tomato primary processing company) a consolidated subsidiary, strengthening its North American procurement base. In January 2026, it made Silbury Marketing Ltd (UK) a subsidiary, integrating its European sales function. Supply capability that deploys common quality control standards across group companies serves as a differentiating factor.
Cash flow from operating activities in FY2025 remained at a high level of ¥26,930 million (versus ¥31,692 million in the prior period). Total capital expenditure over the four years of the previous medium-term management plan reached approximately ¥40,000 million, of which approximately 60% was allocated to international operations while maintaining the financial base. The ratio of equity attributable to owners of the parent stands at a sound 50.7%.
ENVALITH's Perspective
Performance Trend
Sales over the past five fiscal years expanded from ¥189,652 million in FY2021 to ¥306,869 million in FY2024, but declined to ¥294,264 million in FY2025. Cumulative revenue for Q1 FY2026 (ending March 2026) rose only slightly to ¥67,564 million (up 0.6% year on year), while business profit fell sharply to ¥3,438 million (down 25.8% year on year) and quarterly profit attributable to owners of the parent dropped to ¥2,055 million (down 26.9% year on year). External factors—soaring agricultural raw material costs, a decline in tomato paste market prices, and consumers' increasingly frugal spending—combined to worsen profitability both domestically and overseas. Selling, general and administrative expenses increased from ¥16,949 million in the same period of the previous year to ¥18,265 million, making improvement of the cost structure an urgent priority.
Growth Strategy
Aiming for FY2028 revenue of ¥325.0 billion and ROE of 9% or higher, driven by both the expansion of international secondary processing and the strengthening of domestic profitability.
In January 2026, the company acquired Silbury, a UK-based food distributor, for ¥5,524 million and made it a consolidated subsidiary. The aim is to build a structure that effectively links marketing, development, production, and sales functions in Europe, strengthening competitiveness in the European foodservice market centered on the UK. Silbury's contribution to revenue for the cumulative 1Q was ¥3,879 million.
The company is expanding sales of secondary processed products such as pizza sauce and barbecue sauce to foodservice companies in North America, Europe, and India. For the cumulative 1Q of FY2026, secondary processing revenue reached ¥19,301 million (up 14.4% year on year), with business profit of ¥1,684 million (up 25.0% year on year), placing it on a growth trajectory. It is positioned as a key profit pillar to offset the decline in primary processing market conditions.
Against a backdrop of rising agricultural raw material costs, the company revised shipment prices for household and commercial beverages, among other products. To offset the resulting decline in volume, it has strengthened its appeal around the functional (blood pressure-related) benefits of tomato juice, improved advertising cost efficiency in the mail-order channel, and enhanced sales promotion in the food category. For the cumulative 1Q of FY2026, some results have emerged, such as mail-order business profit doubling (2.0x) year on year, but recovery in beverage category volume remains a challenge.
Under the medium-term management plan for 2026–2028, the basic strategy is 'enhancing earnings capacity and strengthening competitiveness through resource allocation to growth and new value areas.' The full-year forecast for FY2026 (ending December 2026) calls for revenue of ¥310,000 million (up 5.3% year on year), business profit/operating profit of ¥23,000 million, and profit attributable to owners of parent of ¥13,400 million (down 9.5% year on year). The 1Q progress rate for business profit stood at a low 14.9%, requiring a recovery in the second half.
Last updated: July 17, 2026