ENVALITH
レオン自動機株式会社 logo

RHEON AUTOMATIC MACHINERY CO., LTD.

6272・Prime Market・Machinery

Official website
レオン自動機株式会社 logo
RHEON AUTOMATIC MACHINERY CO., LTD.6272

Business

Rheon Automatic Machinery was founded in 1963. Building on the "Flow Processing Theory" established by the late Honorary Chairman Torahiko Hayashi, the company applies rheology-based technology as its core strength, developing, manufacturing, and selling food processing machinery centered on Food Forming Machines and bread production lines. The company operates a global four-region structure spanning Japan, North America / South America, Europe, and Asia, with major customers including large and mid-sized bakeries, distribution and food-service chains, and food manufacturers. It also operates a Highly Processed Frozen Food (Orange Bakery) manufacturing and sales business through its U.S. subsidiary Orange Bakery, as well as a food manufacturing and sales business based on Natural Yeast Bread Starter (Hoshino Natural Yeast Bread Starter), which also serves as a test-operation facility for the machinery business. Sales for FY2026 (ending March 2026) are projected at ¥42,014 million.

Business Model

The main revenue source is the Food Processing Machinery Manufacturing and Sales Business (net sales of ¥25,965 million in FY2026), which generates revenue not only from sales of machine units but also from after-sales services such as parts, options, and repair labor. The Food Manufacturing and Sales Business (net sales of ¥16,048 million in the same period) is centered on Orange Bakery in North America / South America, which also contributes to new product development as a demonstration plant for the company's own machinery. The machinery business has a structure in which products are developed and manufactured in Japan, then sold globally through local subsidiaries (Rheon U.S.A. and Rheon Europe) and a network of distributors.

Company Strengths

Backed by proprietary development capabilities based on rheology application technology, the company held 478 patents in total as of the end of FY2026 (136 domestic and 342 overseas). It has built a global four-pole structure with local subsidiaries in Japan, North America / South America, Europe, and Asia since the 1970s, forming a dual entry barrier of technology and sales networks that is difficult for competitors to replicate in a short period.

In FY2026, segment profit for the Food Processing Machinery Manufacturing and Sales Business (Japan) was ¥4,618 million, representing an extremely high profit margin against segment sales of ¥11,484 million. In addition to sales of machinery units, aftersales revenue from Repair, Parts, and Technical Guidance Services accumulates over time, supporting the stability of profit. In FY2026, the company achieved a consolidated operating margin of 12.3% and ROE of 9.5%.

The order backlog for the Food Processing Machinery Manufacturing and Sales Business reached ¥12,249 million at the end of FY2026 (up 19.7% year on year), with notable growth overseas—North America / South America up 41.1% and Europe up 89.0%. Bread Production Lines, etc. tend to have lengthening delivery times, and the thickness of the order backlog serves to a certain extent as a guarantee of sales in the following period and beyond.

ENVALITH's Perspective

In FY2026 (ending March 2026), revenue increased 7.1% to ¥42,014 million, achieving revenue growth, while operating profit declined 2.3% to ¥5,174 million, turning to a profit decrease. The main cause was a 15.5% decline in segment profit for the Food Manufacturing and Sales Business (North America / South America) to ¥1,517 million due to rising logistics costs and other factors. A rise in the cost of sales ratio (from 54.6% in the previous period to 56.6% in the current period) was also confirmed, and skillful cost management will be key to future margin recovery. The forecast for FY2027 (ending March 2027) anticipates an 8.6% increase in operating profit to ¥5,620 million, and whether this can be achieved will be a point of attention.

Cash flow from investing activities in FY2026 (ending March 2026) surged to an outflow of ¥8,474 million (compared to ¥1,999 million in the previous period), and cash and cash equivalents decreased by ¥4,660 million from ¥15,777 million to ¥11,117 million. Construction in progress surged from ¥626 million to ¥5,161 million, indicating that the renewal of head office plant facilities and construction of a new plant are progressing in earnest. Including its positioning as an experimental plant toward realizing a smart factory, quantitative disclosure of the time frame and effects of investment recovery is required to clarify how this large-scale investment will translate into future improvements in production capacity and cost reductions.

The annual dividend for FY2026 (ending March 2026) was ¥58 (up 31.8% from ¥44 in the previous period), and the payout ratio rose substantially to 40.1% (from 30.4% in the previous period). The year-end dividend was increased from the initially planned ¥27 to ¥31, making the company's proactive stance toward shareholder returns clear. The forecast dividend for FY2027 (ending March 2027) is planned to maintain a high level at ¥60 (payout ratio of 40.3%). On the other hand, as an external factor, fluctuations in foreign exchange rates (assuming 1 USD = ¥150 and 1 EUR = ¥175) are a source of uncertainty in the earnings forecast, and continued attention is needed regarding the risk of downside to results if the yen appreciates further.

Growth Strategy

Three pillars — overseas market expansion, realization of smart factories, and strengthening the profit base — driving toward the final year of the medium-term plan

In addition to strengthening existing bases in North America / South America, Europe, and Asia, the company is promoting exhibition participation and reinforcing distributors in emerging markets such as the Middle East, India, and Africa. In FY2026 (ending March 2026), results became evident with Asia up 56.0% and North America / South America up 21.5%. Taiwan, South Korea, and Southeast Asia are also progressing as planned.

The company is advancing a new plant construction plan as an experimental plant in collaboration with the Food Processing Machinery Manufacturing and Sales Business. In FY2026 (ending March 2026), ¥7,989 million was invested in the acquisition of tangible fixed assets, and construction in progress surged to ¥5,161 million. The aim is to achieve cost reductions and shorter delivery times.

Registration as an eligible subject for the SME Labor-Saving Investment Subsidy has increased projects utilizing subsidized equipment. The company is expanding sales of labor-saving and food-loss-reduction products, such as post-proofing frozen bread, to the supermarket and fast food industries. R&D expenses amounted to ¥616 million (down from ¥737 million in the previous fiscal year).

At Orange Bakery, performance fell short of the previous year (segment profit down 15.5% to ¥1,517 million) due to the impact of discontinued customers. The company aims to restore profitability through expanded sales of labor-saving and food-loss-reduction products and the acquisition of new customers. Responding to rising logistics costs is also an issue.

Last updated: July 19, 2026