PICKLES HOLDINGS CO., LTD.

Business Details

Pickles Corporation Holdings Ltd. principally engages, through its subsidiaries and affiliates, in the manufacture and sale of Asazuke Products, kimchi, prepared foods and related items, as well as the sale of pickles. Centered on its flagship product, Gohan ga Susumu Kimchi, the company supplies products nationwide to convenience stores, mass merchandisers, drugstores and other retailers. Using domestically produced raw materials (Chinese cabbage, cucumber, etc.), the company emphasizes food safety and peace of mind. In the first quarter of FY2027 (ending February 2027) (March–May 2026), the company achieved lower revenue but higher profit.

Recent Overview

In Q1 of FY2027 (ending February 2027), revenue declined 4.9%, but operating profit rose 12.5% on lower costs and greater efficiency

Revenue for the first quarter of FY2027 (ending February 2027) (March–May 2026) was ¥10,498 million (down 4.9% year on year). Factors behind the revenue decline included consumers' continued thrift-oriented spending, a decrease in sales to convenience stores, and a reduction in the number of product items as part of profitability improvement measures. On the other hand, stable raw vegetable prices due to favorable weather and progress in production efficiency and automation led to a substantial reduction in cost of sales, to ¥8,036 million (from ¥8,683 million in the same quarter of the prior year). As a result, operating profit rose 12.5% year on year to ¥696 million, ordinary profit rose 12.2% to ¥711 million, and quarterly net income attributable to owners of the parent rose 11.6% to ¥473 million. The full-year earnings forecast (revenue of ¥41,000 million; operating profit of ¥1,820 million) remains unchanged.

Key Products

Growth Drivers

• Reduction in cost of sales through stabilization of raw vegetable prices (Chinese cabbage, cucumber, etc.) (cost of sales ratio for the current Q1 improved to 76.5% from 78.7% in the same period of the prior year)
• Cost reduction through more efficient and automated production systems
• Continued solid sales of the Gohan ga Susumu Kimchi series and expanded sales of key products to mass merchandisers
• Development of new customers through expansion of business-use products (kimchi, prepared foods, frozen foods)
• Continuation of profitability improvement measures through reduction in the number of product items
• Development of new customers and new sales channels leveraging the nationwide manufacturing and sales network
• Enhancement of customer loyalty through collaboration products and the official fan community "Pickles Shokudo"
• Various initiatives centered on the 50th anniversary of the founding of Pickles Corporation (February 2027)

Risks

• Decline in at-home dining demand due to consumers' continued thrift-oriented spending (impact of rising prices and soaring rice prices)
• Risk of fluctuation in sales to convenience stores (a decline continued in the current Q1 as well)
• Risk of unfavorable weather and price spikes for raw vegetables (Chinese cabbage, cucumber, etc.) (in the prior fiscal year, high summer temperatures and unstable weather caused vegetable prices to spike, contributing to lower profit)
• Cost pressure from the continued rise in logistics and labor costs
• Risk of rising energy prices due to escalating tensions in the Middle East and other factors
• The declining trend in the overall pickle market due to the falling birthrate and aging population
• The full-year operating profit forecast of ¥1,820 million represents a 12.7% decrease from the prior year's actual result of ¥2,085 million, with recovery of profitability in the second half being a key challenge
• Risk of economic downside due to changes in the external environment, such as U.S. tariff policy