Nousouken Corporation

Business Details

The company collects agricultural produce from registered producers at collection centers operated by the company and outsourced partners, and, as a rule, sells the produce the following day at direct-sales corners in supermarkets and other retail outlets through a proprietary distribution platform. The business consists of two models: the "Consignment Sales System," in which producers themselves determine sales channels, prices, and product items, and "Purchase Consignment Sales," in which the company bears the inventory risk. The Consignment Sales System is mainly fee-based income and has a high profit margin, making it the core segment that underpins the company's earnings base.

Recent Overview

Revenue rose 8.3% year on year, but segment profit fell 6.5% due to increased personnel and other costs

In the interim period of FY2026 (ending August 2026) (September 2025 to February 2026), revenue increased to ¥2,966 million (up 8.3% year on year), while segment profit declined to ¥390 million (down 6.5% year on year). The number of stores adopting the platform continued to expand, reaching 2,358 stores, up 112 stores from the end of the previous fiscal year, and the number of registered producers grew to 10,587, up 168 from the end of the previous fiscal year. The company implemented profitability-improvement measures such as revising shipping fees and barcode label charges in the Wakayama and Tokai areas, but profit was pressured by increased costs including personnel investment aimed at future business growth. The number of collection centers decreased by 2 locations to 76 due to consolidation.

Key Products

Growth Drivers

• Continued expansion in the number of stores adopting the platform (2,358 stores at the end of February 2026, up 112 stores from the end of the previous fiscal year)
• Increase in the number of registered producers (10,587 at the end of February 2026, up 168 from the end of the previous fiscal year)
• Enhanced monetization through revised shipping fees and barcode label charges in the Wakayama and Tokai areas, among others
• Improved logistics efficiency and strengthened supply capacity through consolidation and functional expansion of collection centers
• Improved accuracy of supply-demand control through development of an AI demand forecasting system (Medium-Term Management Plan 2025-2027)
• Boost to revenue from the full-year contribution of stores opened in the previous fiscal year (Full year, FY2026 ending August 2026)

Risks

• Difficulty in acquiring registered producers due to the continued decline in the number of agricultural business entities (individual operators down 5.2% year on year as of February 2024)
• Fluctuations in fruit and vegetable prices due to unusual weather and extreme heat affecting sales trends at supermarkets and other retailers (supermarket fruit and vegetable sales fell below the same month of the prior year during the current interim period)
• Pressure on profit margins from rising costs such as personnel and system investment (segment profit margin of 13.1% in the interim period of FY2026 ending August 2026, down from 15.2% in the same period of the prior year)
• High dependence on certain sales channels, creating a risk of reduced transactions
• Risk of changes to the management structure following the planned delisting due to going-private by SOMPO Light Vortex Co., Ltd. (scheduled for April 27, 2026)
• Risk of reduced collection capacity in certain areas due to consolidation of collection centers (down by 2 locations)