WARABEYA NICHIYO HOLDINGS CO.,LTD.

Business Details

Manufactures and sells prepared foods such as Rice Products, Prepared Bread Products, Prepared Noodle Products, Freshly Baked Bread Products, Prepared Side Dishes / Japanese Confectionery, and other ready-to-eat items. The main customers are franchise and directly-operated stores of Seven-Eleven Japan (sales of ¥167,037 million in FY2025 (ended February 2025), accounting for 75.1% of the total). Domestically, Warabeya Nichiyo Foods Co., Ltd. and Warabeya Delica Co., Ltd. cover the region from Hokkaido to the Kansai and Shikoku areas, while overseas operations extend to the U.S. (Hawaii, Texas, Virginia) and China (Beijing, Tianjin). This segment accounts for approximately 90% of consolidated net sales and is the Group's core business.

Recent Overview

Sales rose slightly, but profit declined sharply due to the suspension of operations at the Sapporo plant and rising raw material and labor costs

In the first quarter of FY2027 (ending March 2027), net sales in the Food-Related Business were ¥52,323 million (up 1.3% year on year), roughly in line with the same period of the prior year. Segment profit, however, fell sharply to ¥1,516 million (down 28.3% year on year). Although the financial performance of the Isesaki Plant improved, rising raw material prices and labor costs, combined with the impact of the suspension of operations at the Sapporo Plant following a fire in February 2026, significantly weighed on profitability. Non-operating expenses included ¥139 million in costs related to the operational suspension.

Key Products

Growth Drivers

• Revenue-boosting effects including a review of product specifications (expansion of domestic food-related business sales)
• Improvement in the financial performance of the Isesaki Plant (improvement confirmed in Q1 FY2027, ending March 2027)
• Effects of the business transfer of Prepared Noodle Products and Freshly Baked Bread Products from Warabeya Delica Co., Ltd. (March 2024)
• Improved production and logistics efficiency through coordination with the joint delivery business
• Continued development of the business foundation in overseas operations (U.S. and China)

Risks

• Rising raw material costs, mainly rice (continuing into Q1 FY2027, ending March 2027)
• Profit pressure from rising labor costs and logistics costs
• Continued impact of the operational suspension caused by the fire at the Sapporo Plant (occurred February 16, 2026) (¥139 million in operational suspension-related costs recorded in Q1 FY2027, ending March 2027)
• Risk of impairment losses (¥84 million recorded in Q1 FY2027, ending March 2027)
• Impact of one-time costs and shortened useful lives of fixed assets associated with the closure of the Murayama No. 2 Plant
• Risk of delay in overseas growth strategy due to review of the launch timing of the Ohio plant in the U.S.
• Risk of sales concentration on the main customer (Seven-Eleven Japan) (approximately 75% of net sales)