UNITED&COLLECTIVE CO. LTD.

Business Details

The company operates a food and beverage business primarily in Tokyo and three surrounding prefectures (the greater Tokyo area) as well as Osaka Prefecture. It operates a total of 83 stores (as of the end of Q1 FY2027 (ending February 2027), up 3 stores year-on-year) across its core formats: the chicken izakaya "Teketeke" (Chicken Izakaya) and "Motsuyaki Sakaba Teketeke," the hamburger cafe "the 3rd Burger (Hamburger Cafe)," and the seafood bowl/izakaya "Shintaro (Seafood Bowl & Izakaya)." The company pursues both product competitiveness and productivity through its proprietary "PPM Strategy."

Recent Overview

Net sales were roughly flat year-on-year, but operating income plunged 98.7% year-on-year to ¥1 million due to a higher cost ratio and increased expenses

Net sales for Q1 (March to May 2026) of FY2027 (ending February 2027) came in at ¥1,741 million (down 0.2% year-on-year), roughly in line with the prior year. However, due to the impact of price revisions and other factors, cost of sales increased from ¥438 million to ¥467 million, causing gross profit to decline 2.5% year-on-year to ¥1,273 million. Selling, general and administrative expenses swelled to ¥1,272 million (from ¥1,212 million in the same period of the prior year) due to increased recruitment-related costs and personnel expenses associated with stronger hiring efforts as well as increased sales promotion expenses. As a result, operating income came to ¥1 million (versus ¥94 million in the same period of the prior year), with an ordinary loss of ¥12 million and a net loss for the quarter of ¥5 million. No new stores were opened, and the number of stores stood at 83 (up 3 stores year-on-year). The full-year earnings forecast remains unchanged from the figures announced on April 14, 2026.

Key Products

Growth Drivers

• Creation of ordering opportunities and increased items ordered per customer through the introduction of the new "Bakusoku Tsumami (Ultra-Fast Snacks)" category in the "Teketeke" format
• Strengthening of the product lineup through redesign of signature products and introduction of derivative products
• Creation of visit motivation through the sale of limited-time products in the "the 3rd Burger" format
• Recovery of the overall dining-out market driven by expanding inbound demand and the recovery of foot traffic
• Optimization of store operating costs and improved productivity through deepening of the PPM Strategy
• Stable securing and effective deployment of personnel through utilization of the Specified Skilled Worker system

Risks

• Upward pressure on the cost ratio due to persistently high prices for raw materials, ingredients, and energy (cost of sales ratio for the quarter worsened from 25.1% to 26.8% year-on-year)
• Expansion of selling, general and administrative expenses due to the continued rise in recruitment-related costs and personnel expenses associated with stronger hiring efforts
• Downward pressure on customer traffic and average spending per customer due to continued consumer thrift orientation
• Risk of reduced customer traffic following price revisions
• Deterioration of ordinary income/loss due to the burden of financial expenses, including increased interest expenses (from ¥8 million in the same period of the prior year to ¥11 million in the current quarter)
• Risk of recording impairment losses and continued retained earnings deficit (-¥233 million at the end of the current quarter)
• Fragility of the financial base, with an equity ratio of 12.5%