ZENSHO HOLDINGS CO.,LTD.

Business Details

Operates the "Sukiya" beef bowl chain directly in Japan as well as in China, Southeast Asia, and Latin America. Centered on the mainstay beef bowl product, the segment offers safe, delicious food at affordable prices, targeting families and group customers. It leverages MMD (Mass Merchandising System), which manages everything from ingredient procurement to manufacturing, logistics, and sales in an integrated manner, achieving both cost competitiveness and quality. As of the end of FY2026 (ending March 2026), the segment operated 2,650 stores in total, comprising 2,000 domestic stores and 650 overseas stores.

Recent Overview

Revenue increased 6.3%, but price cuts and rising costs led to a sharp 62.0% decline in operating profit

Full-year revenue for FY2026 (ending March 2026) reached ¥314,454 million (+6.3% YoY), securing revenue growth, but operating profit fell sharply to ¥9,317 million (△62.0% YoY). In addition to rising raw material costs from soaring rice prices and increases in imported beef and other ingredients, the beef bowl price cut implemented to prioritize value for customers significantly squeezed profitability. Existing store sales YoY remained solid at 104.3%. During the period, 112 stores were opened and 83 closed, for a net increase of 29 stores. The company continued safety and hygiene measures (enhanced cleaning and planned renovations of aging stores) in response to the foreign object contamination incident at the end of the prior fiscal year.

Key Products

Growth Drivers

• Continued growth in existing store sales (104.3% YoY for full-year FY2026, ending March 2026)
• Expansion of business scale through aggressive overseas store openings (650 overseas stores across China, Southeast Asia, and Latin America)
• Cost competitiveness through integrated management of ingredient procurement, manufacturing, and logistics via MMD (Mass Merchandising System)
• Maintaining customer traffic and average spend through continuous introduction of seasonal and variety menu items
• Improved store quality and enhanced mid-to-long-term customer draw through planned renovations of aging stores

Risks

• Decline in profitability due to lower average customer spend from the beef bowl price cut (full-year FY2026 operating profit down 62.0% YoY, with operating margin sharply declining from 8.3% to 2.9%)
• Upward pressure on raw material costs from soaring rice prices and rising prices of imported beef and other ingredients
• Risk of recurrence of foreign object contamination incidents and impact on brand image (continued safety and hygiene cost burden)
• Rising labor costs and utility costs due to wage increases and higher energy costs
• Foreign exchange risk (impact on overseas store earnings and imported ingredient costs)
• Impairment loss risk (depreciation and amortization rose 14.7% YoY to ¥14,354 million, expanding risk associated with the increase in fixed assets)

Business Details

Operates the "Hama-zushi" sushi chain directly in Japan and in China and other markets. With sushi made from fresh seafood as its mainstay, the chain also offers a wide range of side menu items including noodles, desserts, and drinks, appealing to a broad customer base from children to adults. In FY2026 (ending March 2026), revenue from external customers was ¥320,277 million, accounting for approximately 25.3% of total group revenue, growing into a core segment alongside Global Sukiya. The number of stores at period end expanded to 862 (664 domestic, 198 overseas).

Recent Overview

Revenue up 28.9% and operating profit up 25.4%, continuing high growth, with overseas stores doubling from 96 to 198

In FY2026 (ending March 2026), the segment continued high growth with revenue of ¥320,277 million (+28.9% YoY) and operating profit of ¥26,771 million (+25.4% YoY). During the fiscal year, 132 new stores were opened and 5 closed, achieving a net increase of 127 stores, expanding the period-end store count to 862. In particular, the doubling of overseas stores from 96 to 198 drove the revenue expansion. Meanwhile, depreciation and amortization increased substantially from ¥8,375 million to ¥12,028 million due to aggressive store openings, causing the operating profit margin to decline slightly from 8.6% to 8.4%.

Key Products

Growth Drivers

• Expansion of store count through aggressive new store openings (net increase of 127 stores in FY2026, ending March 2026, bringing the period-end total to 862)
• High growth in existing store sales (115.5% in FY2026, ending March 2026)
• Rapid acceleration of overseas expansion (doubling from 96 stores at the end of FY2025, ending March 2025, to 198 stores at the end of FY2026, ending March 2026)
• Appeal to a broad customer base centered on families and improved average customer spend through diverse side menu offerings

Risks

• Upward pressure on raw material costs from rising prices of seafood and other ingredients
• Increased labor costs due to wage increases
• Risk of stagnant consumer sentiment amid continued price inflation
• Foreign exchange risk and country risk associated with the rapid acceleration of overseas expansion
• Downward pressure on profit margins from increased depreciation and amortization due to aggressive store openings
• Intensifying competition with rival conveyor-belt sushi chains

Business Details

Operates a diverse range of formats domestically and overseas, including "Nakau" (Japanese-style fast food), "Zetteria" (hamburgers), "Katsuan" (tonkatsu), "Kyubeya" (Musashino-style udon), and "The Chicken Rice Shop" (halal-certified chicken rice). As of the end of FY2026 (ending March 2026), the segment operated a total of 1,145 stores, comprising 880 domestic stores and 265 overseas stores (including 57 franchise stores). The company closed all locations of the Sanuki udon specialty chain "Seto Udon" and the café chain "Moriba Coffee," advancing the optimization of its business format portfolio.

Recent Overview

Revenue rose 8.3%, but operating profit fell 7.3% due to rising costs, resulting in lower profitability

In FY2026 (ending March 2026), the segment achieved revenue growth of 8.3% YoY to ¥112,818 million, but operating profit declined 7.3% YoY to ¥3,310 million due to the impact of rising raw material and energy costs. Existing store sales YoY remained solid at 109.2%. As part of format portfolio optimization, the company continued conversion openings to the "Zetteria" format while closing all locations of "Seto Udon" and "Moriba Coffee." With 31 new stores opened and 103 stores closed, the period-end store count came to 1,145.

Key Products

Growth Drivers

• Continued improvement in existing store sales (109.2% YoY in FY2026, ending March 2026)
• Improved profitability through review of the business format portfolio (conversions to Zetteria, restructuring of unprofitable formats)
• Expansion of overseas fast food business (The Chicken Rice Shop, etc.)
• Ingredient cost management through use of the group's MMD (Mass Merchandising System)
• Improved store operation efficiency through DX promotion and self-ordering systems

Risks

• Rising raw material costs from increases in ingredient prices (imported beef, rice, etc.)
• Profit pressure from rising labor costs due to wage increases
• Temporary costs (including impairment losses) associated with format conversions and store closures
• Risk of reduced customer traffic due to stagnant consumer sentiment
• Foreign exchange and geopolitical risk in overseas operations (including U.S. trade policy, etc.)
• Increased management costs and low profitability from operating multiple formats (operating profit margin of 2.9%)

Business Details

Centered on the family restaurant chain "Coco's," the segment operates a diverse range of formats including the pasta specialty chain "Jolly-Pasta," the hamburger steak and steak restaurant "Big Boy," the yakiniku restaurant "Jukusei Yakiniku Ichiban," the Italian restaurant "Olive no Oka," and the Japanese restaurant "Hanaya Yohei." As of the end of FY2026 (ending March 2026), the segment operated a total of 1,181 stores, comprising 1,180 domestic stores and 1 overseas store (including 76 franchise stores). The segment is promoting improvement in existing store sales through the active introduction of seasonally-themed fair menus and enhanced service standards.

Recent Overview

Both revenue and operating profit increased YoY, with continued strength in existing store sales

Full-year revenue for FY2026 (ending March 2026) came to ¥171,281 million (+9.7% YoY), with operating profit of ¥12,998 million (+14.1% YoY), achieving both revenue and profit growth. Existing store sales YoY remained strong at 109.8%. There were 6 new store openings and 11 closures, bringing the period-end store count to 1,181. The active introduction of seasonally-themed fair menus, pursuit of specialty-restaurant-level quality, and enhanced service standards all contributed to the improved performance.

Key Products

Growth Drivers

• Continued improvement in existing store sales (109.8% YoY for full-year FY2026, ending March 2026)
• Increased customer traffic and average spend through the introduction of seasonally-themed fair menus and enhanced product strength
• Improved customer satisfaction and repeat visits through enhanced service standards
• Optimization of the store portfolio (closure of unprofitable stores and selective new openings)
• Recovery in dining-out demand accompanying the resumption of foot traffic and normalization of economic activity

Risks

• Increased raw material costs from rising prices of rice, imported beef, seafood, and other ingredients
• Increased labor costs amid the wage increase trend
• Risk of stagnant consumer sentiment and impact on customer traffic amid continued price inflation
• Impairment loss risk (¥3,983 million in impairment losses recorded group-wide)
• Future impairment risk related to goodwill balances (goodwill amortization of ¥385 million for full-year FY2026, ending March 2026)

Business Details

Centered on the supermarkets Maruya Co., Ltd. and Joyfoods Co., Ltd., as well as United Veggies Co., Ltd. (fruit and vegetable sales). The segment's primary trading area is the Northern Kanto region, catering to local residents' everyday food and fresh produce needs. With a group revenue share of approximately 6.1%, it is relatively small in scale and has business characteristics distinct from the foodservice and ready-to-eat foods segments. Although operating losses have continued, the loss margin has narrowed YoY, and improving profitability remains an ongoing challenge for this segment.

Recent Overview

Existing store sales recovered to 103.1%, and the operating loss margin narrowed significantly YoY

Full-year revenue for FY2026 (ending March 2026) rose slightly to ¥76,977 million (+1.2% YoY). Existing store sales YoY improved significantly to 103.1% from 98.2% in the prior year. The operating loss narrowed to ¥1,025 million from ¥1,794 million in the prior year. The store count decreased by 6 stores to 120. Even amid continued cost burden increases from soaring rice prices and rising prices of imported ingredients, the recovery in existing store sales contributed to improved profit and loss.

Key Products

Growth Drivers

• Recovery in existing store sales YoY to 103.1% (a significant improvement from 98.2% in the prior year)
• Improved profitability and portfolio optimization through closure of unprofitable stores
• Narrowing trend in operating losses (from △¥1,794 million in the prior year to △¥1,025 million in the current year)
• Capturing stable local demand as a community-based supermarket

Risks

• Upward pressure on raw material costs from soaring rice prices and rising prices of imported ingredients
• Increased labor costs due to wage increases
• Risk of shrinking revenue scale amid continued net store closures
• Impact on customer traffic and average spend from stagnant consumer sentiment
• Risk of recording impairment losses (segment with ongoing operating losses)

Business Details

The "Others" segment consists of business segments not included in the reportable segments. Its main businesses are external manufacturing and wholesale, nursing care, and livestock/fisheries operations. Specifically, it includes Trona Japan Co., Ltd., which plans, develops, and sells household frozen foods, Sanbishi Co., Ltd., which manufactures and sells soy sauce and dressings, Kagayaki Co., Ltd., which operates nursing care services, and Zensho Rice Co., Ltd., which sells brown rice and milled rice. This diversified group of businesses complements the group's overall food infrastructure. In FY2026 (ending March 2026), revenue from external customers was ¥35,638 million, down 13.7% YoY.

Recent Overview

Revenue declined due to the dissolution and liquidation of Pocino Foods Company, but the operating loss narrowed substantially

In FY2026 (ending March 2026), the group decided to dissolve and liquidate its consolidated subsidiary Pocino Foods Company (external manufacturing and wholesale business), in response to changes in the market environment and the group's decision to concentrate and select management resources, and recorded a business withdrawal loss as an extraordinary loss. As a result, revenue from external customers declined 13.7% YoY to ¥35,638 million, while the operating loss narrowed substantially from ¥2,002 million in the prior year to ¥371 million, improving profitability.

Key Products

Growth Drivers

• Improved profit structure through the restructuring of the unprofitable Pocino Foods Company business upon its withdrawal
• Stable earnings contribution from existing businesses such as Sanbishi Co., Ltd. and Trona Japan Co., Ltd.
• Expansion of internal transaction and support demand accompanying the strengthening of the group's food infrastructure

Risks

• Recording of a business withdrawal loss associated with the dissolution and liquidation of Pocino Foods Company (external manufacturing and wholesale business) (¥1,378 million recorded as an extraordinary loss)
• Risk of further business scale contraction, as revenue from external customers declined 13.7% YoY
• Structure in which fixed cost burden tends to squeeze profitability, given the segment's small group revenue share of approximately 2.8%
• Impact on raw material costs from rising ingredient prices and energy costs
• Risk of intensifying competition and rising labor costs in non-dining businesses such as nursing care and livestock/fisheries