Yuki Gosei Kogyo Co., Ltd.

Business Details

The sole business segment of Yuki Gosei Kogyo. Comprises three product categories: Amino Acids (used in pharmaceuticals, food additives, etc.), Chemical Products (raw materials for tire cord adhesives, polymer materials, electronic materials, etc.), and Pharmaceuticals (pharmaceutical raw materials, intermediates, etc.). The export ratio for FY2026 (ending March 2026) rose to 51.9% (¥8,018 million) from 49.8% in the prior period. The subsidiary Yuki Techno Service Co., Ltd. handles contracted manufacturing operations.

Recent Overview

Net sales reached a record high for the seventh consecutive period, but operating income fell 68% due to a sharp drop in electronic material prices and depreciation from new facilities

For FY2026 (ending March 2026), net sales reached ¥15,448 million (up 2.1% year on year), a record high for the seventh consecutive period. However, due to the first-year depreciation burden from the amino acid-related facility completed in June 2025, combined with a sharp decline in market prices and share for some electronic material products within Chemical Products in the fourth quarter, operating income fell sharply to ¥383 million (down 68.4% year on year) and ordinary income to ¥303 million (down 73.4%). The company received ¥1,854 million in government subsidies related to the acquisition of the amino acid-related facility and applied deferred-tax accounting. For FY2027 (ending March 2027), the company forecasts net sales of ¥16,000 million (up 3.6% year on year), but profit forecasts remain undetermined due to the difficulty in assessing the impact of the situation in the Middle East.

Key Products

Growth Drivers

• Full-scale operation of the amino acid-related facility completed in June 2025, boosting production capacity and expanding sales for pharmaceutical applications
• Solid demand for polymer materials and raw materials for tire cord adhesives within Chemical Products (up 10.5% in FY2026, ending March 2026)
• Continued rise in export ratio (from 49.8% in the prior period to 51.9% in the current period), capturing global demand
• Expansion of contract manufacturing business within Pharmaceuticals (a key initiative of the medium-term management plan)
• Promotion of profit structure reform through supply chain resilience and shift toward higher value-added fields

Risks

• Ongoing profitability deterioration due to a sharp drop in market prices and share for electronic material products (which emerged in the fourth quarter)
• Profit pressure from increased depreciation burden (depreciation of ¥1,238 million, up ¥204 million year on year) associated with large-scale investment in amino acid manufacturing facilities
• Risk of raw material and fuel price surges, procurement delays, and supply chain disruption due to escalating tensions in the Middle East (the main reason profit forecasts for FY2027, ending March 2027, remain undetermined)
• Decline in gross margin (from 21.9% in the prior period to 17.0% in the current period) due to persistently high raw material and energy prices and increased logistics and labor costs
• Risk of loosening supply-demand balance for commodity products due to China's economic slowdown, and foreign exchange volatility risk
• Risk of changes in trading terms due to sales concentration with major customers