The Monogatari Corporation

Business Details

Monogatari Corporation operates multiple domestic brands—led by "Yakiniku King" (Yakiniku King), "Marugen Ramen," and "Sushi & Shabu-Shabu Yuzuan"—as large-format suburban roadside restaurants. The company secures earnings through a dual axis of directly-operated stores and franchising, and is expanding operations into China, Southeast Asia, North America, the Philippines, and other regions. As of end-March 2026, the total number of stores stood at 895 (794 domestic, 101 overseas). As the company operates a single restaurant business segment, segment-level disclosure is omitted.

Recent Overview

Continued high growth with cumulative Q3 net sales up 21% and operating profit up 31% year on year; full-year forecast maintained

For the cumulative nine months of Q3 FY2026 (July 2025 to March 2026, ending June 2026), net sales were ¥112,103 million (up 21.0% year on year) and operating profit was ¥9,125 million (up 31.4% year on year), representing substantial growth in both revenue and profit. The overseas category expanded rapidly to ¥10,093 million in sales (up 188.6% year on year), driven by the consolidation of Storytellers USA, among other factors. Domestically, all three flagship categories—yakiniku, ramen, and Yuzuan—posted double-digit sales growth. During the period, 48 domestic and 47 overseas stores were opened, bringing the total store count to 895 as of end-March 2026. The full-year earnings forecast (net sales of ¥147,159 million and operating profit of ¥10,771 million) remains unchanged.

Key Products

Growth Drivers

• Continued aggressive new store openings (48 domestic and 47 overseas stores opened cumulatively through Q3 FY2026) driving store count expansion
• Continued growth in domestic existing-store sales (up 3.9% year on year for directly-operated stores, up 2.6% for franchised stores)
• High growth in the Yuzuan, ramen, and specialty store categories (Yuzuan up 24.4% year on year, ramen up 15.6%)
• Rapid expansion of overseas business (overseas category sales up 188.6% year on year, consolidation of Storytellers USA's income statement, new market entries into Singapore, Taiwan, Thailand, and the Philippines)
• Improved productivity and enhanced customer experience through store-level digital transformation (new express lanes, expanded introduction of serving robots, self-checkout, etc.)
• Improved profitability through price revisions (including introduction of urban-format pricing)
• Format development and cultivation of new business formats (Yakitate no Karubi, Kajitsuya Coffee, etc.) under the medium-term management vision "Monogatari Vision 2030" and the "Medium-Term Three-Year Management Plan 2026-2028"

Risks

• Rising operating costs from continued increases in raw material prices, labor costs, and utility expenses (interest expense also increased from ¥32 million to ¥204 million year on year)
• Risk of dampened dining-out demand due to strengthening consumer thrift sentiment
• Impact on overseas operations from uncertainty in international affairs (U.S. trade policy, foreign exchange fluctuations)
• Difficulty securing personnel and rising labor costs due to a shrinking labor supply
• Increasing country risk and foreign exchange risk associated with overseas business expansion (foreign currency translation adjustment worsened from ¥129 million to ¥55 million versus the prior fiscal year-end)
• Risk of impairment losses on fixed assets (failure to recover store investment)
• Rising financial leverage from increased borrowings amid a declining equity ratio trend (54.3% to 52.3%)