JFLA Holdings Inc.

Business Details

The manufacturing division comprises the three dairy companies Kyushu Nyugyo, Ibaraki Nyugyo, and Kojyusha, together with Morita Co., Ltd. (soy sauce, miso, alcoholic beverages), among others. It manufactures and sells dairy products such as milk, yogurt, and soy milk, fermented seasonings such as soy sauce and miso, and alcoholic beverages such as sake and shochu. As a core segment accounting for approximately 67% of the Group's consolidated net sales, it is the primary focus of the business revitalization plan's product price increases, portfolio optimization, and capital investment.

Recent Overview

Achieved higher sales and profit, with operating profit up 24.6% year on year, a substantial improvement

In the full year of FY2026 (ending March 2026), the Production segment achieved net sales of ¥44,069 million (+1.8% year on year) and operating profit of ¥2,146 million (+24.6% year on year), a substantial increase in profit. Kyushu Nyugyo saw increased sales but decreased profit due to higher personnel costs, electricity costs, and logistics costs, while Ibaraki Nyugyo, Kojyusha, and Morita all achieved higher profits. Morita saw a decline in sales due to the impact of the Nikko plant sale, but its profitability-focused sales strategy proved effective. Capital investment also became more active, with the increase in tangible and intangible fixed assets rising substantially to ¥1,440 million from ¥849 million in the prior period.

Key Products

Growth Drivers

• Expansion of Surplus Milk Processing Contract Services revenue (continued growth in demand for highly profitable contract processing)
• Improved profitability through a profitability-focused sales strategy (as demonstrated at Morita and others)
• Productivity improvement and expansion of production lines through active capital investment (¥1,440 million invested in the current period)
• Close collaboration with major customers and enhanced product development at Ibaraki Nyugyo
• Improved profitability through the effects of product price increases (appropriate pricing based on the business revitalization plan)

Risks

• Upward pressure on manufacturing costs from persistently high raw material and energy prices (rising personnel costs, electricity costs, and logistics costs at Kyushu Nyugyo squeezed profits)
• Continued increases in personnel and logistics costs
• Sluggish demand for home cooking (impact on sales volume from stronger consumer thrift consciousness)
• Temporary decline in sales due to the restructuring of unprofitable plants and businesses (such as the sale of Morita's Nikko plant)
• Indirect impact on raw material procurement costs from prolonged yen depreciation