MATSUOKA CORPORATION

Business Details

The company handles OEM production of a wide range of apparel products including men's and women's casual wear, innerwear/cut-and-sew products, and working wear. It operates its own factories in five overseas countries—China, Vietnam, Bangladesh, Indonesia, and Myanmar—providing integrated services from planning and manufacturing to logistics. In the Lamination Film Business, the company develops and manufactures materials with moisture permeability, waterproofing, and durability functions in China and Vietnam. Following a review of its management reporting structure this fiscal year, the company transitioned from a single segment to a two-segment structure consisting of the Sewing Business and the Lamination Film Business.

Recent Overview

The Sewing Business achieved a significant profit increase, while the Lamination Film Business saw a sharp decline in profit due to a reactionary drop

In FY2026 (ending March 2026), the Sewing Business performed well, expanding production capacity at its Bangladesh factory amid rising demand for working wear and innerwear, with unit sales volume up 22.1% year on year and segment profit up 67.6% year on year. Meanwhile, the Lamination Film Business deteriorated significantly, with unit sales volume down 25.2% and segment profit down 67.9%, due to the normalization of material supply following the prior year's hit product and customer inventory adjustments. On a consolidated basis, the company achieved revenue of ¥74,251 million (up 5.2% year on year), operating profit of ¥2,174 million (up 401.3% year on year), and operating profit adjusted for foreign exchange gains/losses of ¥4,813 million (up 13.7% year on year). Starting this fiscal year, the company transitioned from a single segment to a two-segment structure comprising the Sewing Business and the Lamination Film Business. The forecast for FY2027 (ending March 2027) calls for revenue of ¥80,000 million, operating profit of ¥3,400 million, and ordinary profit of ¥4,900 million. Under the medium-term management plan "BEYOND2028 – Stitch the Future" (FY2026-FY2028), the company targets revenue of ¥90,000 million, ordinary profit of ¥6,000 million, and net income of ¥4,000 million in the final year.

Key Products

Growth Drivers

• Expansion of production scale and strengthening of cost competitiveness through the promotion of a production location shift toward ASEAN countries and others, centered on the Bangladesh factory
• Growth in Sewing Business orders driven by increased demand for working wear (including fan-equipped wear), innerwear, and cut-and-sew products
• Improved productivity and gross profit margin through higher factory utilization rates driven by increased orders
• Improved productivity and strengthened base functions through progress in establishing production processes at the Indonesia factory
• Advanced manufacturing management, shortened delivery times, and improved quality through smart factory transformation via the introduction of MES and ERP systems
• Expansion of production capacity and optimal allocation in ASEAN countries and elsewhere based on the medium-term management plan "BEYOND2028"
• Establishment of a high-quality, appropriately priced, and stable supply system through evolution into a "factory of choice"

Risks

• Fluctuations in the yen-converted value of overseas subsidiaries' manufacturing costs and SG&A expenses due to exchange rate movements (a structural factor causing operating profit volatility)
• Uncertainty over demand recovery in the Lamination Film Business and continued weakness in the Chinese economy and consumer spending
• Risk of changes in customer ordering behavior due to trends in U.S. trade policy and tariff measures
• Impact on production bases from geopolitical risks (such as instability in the domestic situation in Myanmar)
• Risk of revenue concentration among major customers (in the prior fiscal year, Toray Industries (H.K.) Ltd., Toray International, and Uniqlo together accounted for approximately 50% of revenue)
• Risk of fluctuations in energy and raw material prices due to tensions in the Middle East situation
• Impact on procurement and production from heightened geopolitical risks surrounding the supply chain
• Cost increases due to worsening labor shortages and persistently high raw material and energy costs