SATO FOODS INDUSTRIES CO., LTD.
2814・Standard Market・Foods
Food processing business (single segment)
A single-segment company manufacturing and selling natural food ingredients
| Period | Current | Previous | Change |
|---|---|---|---|
| Net sales | ¥6,832 million | ¥6,360 million | ↑ |
| Operating profit | ¥758 million | ¥672 million | ↑ |
| Ordinary profit | ¥907 million | ¥813 million | ↑ |
| Net income | ¥736 million | ¥596 million | ↑ |
| Operating margin | 11.1% | 10.6% | ↑ |
| ROA (ordinary profit to total assets) | 4.1% | 3.8% | ↑ |
| ROE (net income to equity) | 3.7% | 3.1% | ↑ |
| Earnings per share | ¥194.65 | ¥141.24 | ↑ |
| Annual dividend per share | ¥50.00 | ¥42.00 | ↑ |
Business Details
Sato Foods Industries operates a single food-processing segment engaged in the manufacture and sale of tea extracts, powdered natural seasonings, plant extracts, liquid natural seasonings, and powdered alcohol. Major customers include ITO EN, Ltd. (15.1% of net sales), Ohtori Corporation (11.2%), and Mitsubishi Corporation Life Sciences Limited (10.4%). The company's core strength lies in its proprietary technology for powdering natural flavors, through which it supplies high-value-added ingredients for beverages, confectionery, and home-cooking applications. It is a standalone, non-consolidated entity with no subsidiaries or affiliates.
Recent Overview
Sales increased across all categories led by tea extracts, with margin improvement driving net income to a record high
In FY2026 (ending March 2026), the company posted net sales of ¥6,832 million (up 7.4% year on year), operating profit of ¥758 million (up 12.7%), and net income of ¥736 million (up 23.5%), with all key metrics exceeding the prior-year period. Tea extracts led the growth with a 9.3% increase, while powdered natural seasonings (up 7.9%) and liquid natural seasonings (up 5.9%) also performed well. Selling, general and administrative expenses decreased by ¥70 million year on year, mainly due to a significant reduction in provision for board benefit trust, contributing to margin improvement. On the other hand, for FY2027 (ending March 2026), the company forecasts net sales of ¥6,732 million (down 1.5% year on year) and operating profit of ¥373 million (down 50.8%), a substantial profit decline, with concerns over the impact of rising raw material costs and other factors.
Key Products
Growth Drivers
- Rising demand for beverage and confectionery applications driven by expanding inbound tourism demand (led by tea extracts and plant extracts)
- Stable demand for powdered and liquid natural seasonings supported by sustained home-cooking demand
- Continued investment in developing high-value-added products (R&D expenses of ¥161 million, 2.4% of net sales)
- Expansion and differentiation of the product lineup through development of new manufacturing methods and technologies
- Promotion of automation and labor-saving through renewal of manufacturing equipment, improving productivity (¥328 million in acquisitions of tangible fixed assets)
Risks
- Upward pressure on cost ratio from persistently high raw material and energy costs (cost ratio of 75.9% in FY2026, ending March 2026)
- Sharp profit decline forecast for FY2027 (ending March 2026), with operating profit expected to fall 50.8% and net income 49.9%, mainly due to rising raw material and other costs
- Economic downside risk and weaker consumer sentiment stemming from U.S. trade policy and geopolitical risks
- Uncertainty in the procurement of imported raw materials amid concerns over the Chinese economic outlook
- Decline in sales of the powdered alcohol category (down 14.5% year on year in FY2026, ending March 2026)
- Risk of sales concentration among specific customers (top three customers account for approximately 37% of total net sales)
- Increased cash outflow from financing activities due to share buybacks (¥830 million) and a resulting decline in cash balances
Last updated: June 23, 2026