NAGAILEBEN Co.,Ltd.

Business Details

The Group plans, manufactures, and sells medical wear (Healthcare Wear, Doctor Wear, Surgical Wear, Patient Wear, etc.) and shoes used by medical and nursing care workers. In addition to supply from its manufacturing subsidiary Nagai Hakui Kogyo Co., Ltd., the Group also procures from overseas and domestic business partners. The domestic core market accounts for approximately 73.6% of net sales, and while maintaining an extremely sound financial structure with an equity ratio of 92.3%, the Group is implementing active shareholder returns.

Recent Overview

Cumulative Q3 results showed lower sales and profit, but gross margin improved; full-year forecast unchanged

Net sales for the nine months ended Q3 FY2026 (ending March 2026) (September 2025 to May 2026) were ¥13,267 million (down 0.7% year on year), and operating profit was ¥2,813 million (down 3.5%). While weak demand for Patient Wear (down 10.5%) was a factor behind the overall decline in sales, gross profit margin improved by 0.4 percentage points year on year to 40.0%, supported by reduced overseas logistics costs, an increased ratio of overseas production, and improved profitability from price revisions. Selling, general and administrative expenses increased by 5.1% due to wage increases and other factors. There is no change to the full-year earnings forecast (net sales of ¥18,000 million and operating profit of ¥4,025 million). As a subsequent event, the Board of Directors resolved on June 29, 2026 to acquire treasury shares of up to 600,000 shares and up to ¥1,000 million (acquisition period: June 30, 2026 to October 31, 2026).

Key Products

Growth Drivers

• Continued improvement in gross profit margin due to ongoing penetration of price revisions (achieved 40.0% for cumulative Q3, up 0.4 percentage points year on year)
• Reliable delivery of replacement orders in the Core Market (large orders carried over from the prior fiscal year were delivered as scheduled)
• Steady expansion of Surgical Wear (Compel Pack) sales (up 5.3% year on year for cumulative Q3)
• Expansion of overseas markets: steady growth of 24.1% year on year for cumulative Q3 due to sales channel expansion and other factors
• Effects of revisions to medical service fees (+3.09%) and long-term care fees (+2.03%) are expected to gradually materialize going forward, stabilizing the operating environment for medical institutions
• Continued promotion of cost reduction measures through increasing the overseas production ratio and reducing overseas logistics costs
• Medium-term management plan: targeting net sales of ¥19,500 million and operating profit of ¥4,700 million for FY2028 (ending March 2028) through deployment of high-value-added products and development of overseas markets

Risks

• Continued increases in raw material prices and cost pressure from rising processing fees and minimum wages at domestic factories
• Continued weak demand in the Patient Wear market (down 10.5% year on year for cumulative Q3) and difficulty in securing new orders
• Risk of delays in replacement orders due to prolonged and difficult price revision negotiations (some delays occurred in Core Market replacement orders for cumulative Q3)
• Rising energy prices and logistics costs, as well as concerns over medical supply availability, due to heightened tensions in the Middle East
• Impact of rising cost-related exchange rates due to continued yen depreciation
• Risk of restrained capital investment and purchasing by medical institutions and nursing care operators due to a deteriorating operating environment (continued price increases)
• Risk of economic downturn and supply chain instability due to geopolitical risks such as US trade policy
• Pressure on profit from increased selling, general and administrative expenses (up 5.1% year on year for cumulative Q3 due to wage increases and other factors)