HOTLAND HOLDINGS Co., Ltd.

Business Details

A multi-format dining segment centered on the flagship brand Tsukiji Gindaco, encompassing the izakaya business (Gindaco Highball Sakaba, Oden to Robata Takeshi, etc.), the staple food business (Tokyo Aburagumi Sohonten, Atsugiri Tonkatsu Yoshihei, etc.), tourist-location formats (Fun International), and overseas business (Asia, U.S.). Stores are operated domestically and internationally through three formats—directly managed, PC (partner company), and FC—and the company aims to expand sales through continuous new store openings and sales promotion measures.

Recent Overview

Net sales increased 6.3% year on year, but segment profit was nearly flat, with profitability improvement remaining a challenge.

In Q1 FY2026 (January to March), Food & Beverage Business net sales were ¥13,391 million (up 6.3% year on year), securing an increase in sales, while segment profit was ¥754 million (down 0.1% year on year), essentially flat. Existing store sales declined year on year, partly due to the rebound effect from the previous year's large-scale collaboration promotions, though underlying demand was described as steady. While aggressive new store openings and profitability improvement progressed in the izakaya and staple food formats, an impairment loss of ¥28 million was recorded in the Food & Beverage Business segment (compared with ¥0.59 million in the same period of the prior year). Overseas, new stores were opened in the Philippines, Indonesia, and Taiwan.

Key Products

Growth Drivers

• Continued new store openings (multiple brands aggressively opened stores domestically and internationally in Q1 FY2026)
• Continued nationwide and overseas expansion of Gindaco Highball Sakaba (including the opening of one store in Taiwan)
• Strong existing-store performance and aggressive store openings in staple food formats (Tokyo Aburagumi Sohonten, Atsugiri Tonkatsu Yoshihei)
• Sustained high level of inbound demand (Fun International Operated Stores performing steadily)
• Expansion of overseas FC development (expansion into Asia and ASEAN, including the Philippines, Indonesia, and Taiwan)
• Enhanced overseas recognition of group products and Japanese food brands following the decision to offer takoyaki at the world's largest soccer tournament
• New customer acquisition measures such as collaboration products with the Los Angeles Dodgers
• Improved profitability through cross-format operational improvements and menu composition reviews

Risks

• Risk of rising procurement costs due to soaring raw material prices (octopus) and foreign exchange fluctuations
• The challenging environment in the food service industry, with continued increases in labor costs, utility costs, and other expenses (SG&A expenses increased year on year)
• Continued risk of impairment losses on fixed assets at unprofitable stores (¥28 million recorded in Q1 FY2026, a significant increase year on year)
• Profit pressure from continued upfront investment expenses in the U.S. business (business portfolio under review)
• Impact of changes in the consumption environment in some overseas regions (brand penetration and profitability improvement remain challenges in existing areas including Hong Kong)
• High dependence on sales from a specific brand (Tsukiji Gindaco)
• Decline in existing store sales year on year due to the rebound effect from the prior year's large-scale collaboration promotions