FUJI SEAL INTERNATIONAL,INC.

Business Details

Centered on Fuji Seal, Inc., this segment plans, develops, manufactures, and sells Shrink Label, Tack Label, Soft Pouch, and Packaging Machinery for the domestic market. Subsidiaries such as Fuji Astec Inc. (machine maintenance), Fuji Tac East Co., Ltd. and Fuji Seal West Co., Ltd. (Tack Label and Soft Pouch manufacturing), and Toride Pharma Co., Ltd. (pharmaceutical packaging contract services) each perform specialized functions, with domestic beverage, food, and pharmaceutical manufacturers as the main customers. In FY2026 (ending March 2026), sales were ¥100,635 million and operating profit was ¥9,637 million, down 1.9% and 2.6% year on year, respectively.

Recent Overview

Declines in Tack Label, Soft Pouch, and Others weighed on results, with both sales and profit down year on year.

In the Japan segment for FY2026 (ending March 2026), while Packaging Machinery (up 8.6% year on year) performed well, Tack Label (down 11.9%), Soft Pouch (down 4.2%), and Others (down 3.4%) declined, resulting in total sales of ¥100,635 million (down 1.9% year on year) and operating profit of ¥9,637 million (down 2.6% year on year). In addition, an impairment loss of ¥417 million (recorded as reorganization expenses) associated with the reorganization of Fuji Tac East Co., Ltd. and manufacturing transfer costs of ¥132 million, among others, were recorded as extraordinary losses. Capital expenditure increased significantly, with the increase in property, plant and equipment and intangible assets reaching ¥8,866 million (a substantial increase from ¥2,772 million in the prior period).

Key Products

Growth Drivers

• Continued stable demand for Shrink Label (for the domestic beverage and food markets)
• Increased sales of Packaging Machinery (up 8.6% year on year in FY2026, ending March 2026)
• Steady strengthening of the existing four businesses and improvement in production efficiency under the FSG.30 strategy
• Accelerating shift toward environmentally friendly products
• Medium- to long-term improvement in cost structure through manufacturing site reorganization (Fuji Tac East Co., Ltd., etc.)
• Expected recovery in FY2027 (ending March 2027), with projected sales of ¥102,800 million (up 2.2% year on year) and operating profit of ¥10,200 million (up 5.8% year on year)

Risks

• Continued decline in Tack Label sales (down 11.9% year on year in FY2026, ending March 2026)
• Risk of demand fluctuation in Soft Pouch (down 4.2% year on year in FY2026, ending March 2026)
• Declining sales trend in the "Others" category (down 3.4% year on year in FY2026, ending March 2026)
• Risk of additional reorganization expenses and impairment losses arising from the restructuring of manufacturing sites in the Japan segment
• Risk of fluctuations in raw material costs (profit pressure from rising raw material procurement costs)
• Impact on packaging demand from uncertainty in the domestic economy and changes in consumption trends
• Risk of future profit pressure from increased depreciation associated with the substantial increase in capital expenditure (¥8,866 million)

Business Details

With the United States and Mexico as its primary markets, this segment manufactures, sells, and provides maintenance services for Shrink Label, Tack Label, Soft Pouch, and Packaging Machinery. In FY2026 (ending March 2026), sales were ¥68,268 million (up 3.2% year on year, up 4.6% on a local currency basis) and operating profit was ¥6,602 million (up 1.7% year on year). Shrink Label served as the driving force, Soft Pouch expanded significantly, while Tack Label trended weakly.

Recent Overview

Driven by Shrink Label and Soft Pouch, achieved a 4.6% increase in sales on a local currency basis

In FY2026 (ending March 2026), despite a slightly stronger yen with an average USD exchange rate of ¥149.61 (versus ¥151.69 in the prior period), sales increased 4.6% on a local currency basis. The mainstay Shrink Label expanded steadily, up 4.9% on a local currency basis, while Soft Pouch surged 551.8% year on year. Meanwhile, Tack Label remained weak, down 10.0% on a local currency basis. Operating profit rose 1.7% year on year to ¥6,602 million, and capital expenditure (increase in property, plant and equipment and intangible assets of ¥4,609 million) was expanded by 57% year on year, laying the groundwork for future growth. For FY2027 (ending March 2027), sales are projected at ¥74,300 million (up 8.8% year on year) and operating profit at ¥7,800 million (up 18.1% year on year), indicating continued substantial growth.

Key Products

Growth Drivers

• Continued expanding demand for Shrink Label in the North American market (up 4.9% year on year on a local currency basis in FY2026, ending March 2026)
• Rapid business expansion of Soft Pouch in the Americas market (up 560.8% year on year on a local currency basis in FY2026, ending March 2026)
• Aggressive capital expenditure under the FSG.30 strategy (increase in property, plant and equipment and intangible assets up 57% year on year to ¥4,609 million)
• Rapid response to customer needs through maintaining and developing a local production and consumption structure
• Expected continuation of a high-growth trajectory in FY2027 (ending March 2027), with sales up 8.8% and operating profit up 18.1%

Risks

• Risk of fluctuation in the USD/JPY exchange rate (projected rate of ¥150.00 for FY2027, ending March 2027; impact on yen-denominated sales if the yen appreciates)
• Impact of changes in U.S. tariff policy on raw material costs and the supply chain (currently assessed as minor, but uncertainty remains)
• Continued weakness in Tack Label demand (down 10.0% year on year on a local currency basis in FY2026, ending March 2026)
• Uncertainty in the business environment due to continued geopolitical tensions
• Risk of raw material price fluctuations and stable procurement

Business Details

The Europe segment has manufacturing and sales sites in nine countries including the United Kingdom, the Netherlands, France, Spain, Poland, Switzerland, Germany, and Italy. In addition to manufacturing and selling Shrink Label and Tack Label, it provides manufacturing, sales, and maintenance services for Packaging Machinery. In FY2026 (ending March 2026), Tack Label increased 22.8% year on year and machinery increased 13.8% year on year, achieving sales growth across all product categories; combined with the effect of a stronger euro, both sales and operating profit rose substantially across Europe as a whole. Note that Fuji Seal Switzerland AG was liquidated during the period and excluded from the scope of consolidation.

Recent Overview

Sales growth of 11.6% and operating profit growth of 23.2% achieved as all product categories grew

In FY2026 (ending March 2026), the Europe segment achieved sales of ¥38,738 million (up 11.6% year on year, up 8.2% on a local currency basis) and operating profit of ¥2,628 million (up 23.2% year on year, up 19.5% on a local currency basis). All categories, Shrink Label (up 6.5%), Tack Label (up 22.8%), and machinery (up 13.8%), grew sales year on year. The average euro exchange rate also rose 3.1% from ¥164.05 in the prior period to ¥169.19 in the current period, boosting yen-denominated sales. Fuji Seal Switzerland AG was liquidated during the period, and a gain on liquidation of subsidiary of ¥4,984 million was recorded as extraordinary income. For FY2027 (ending March 2027), the Europe segment is projected to achieve sales of ¥41,100 million (up 6.1% year on year) and operating profit of ¥2,700 million (up 2.7% year on year).

Key Products

Growth Drivers

• High growth in Tack Label (up 22.8% year on year, up 19.1% on a local currency basis in FY2026, ending March 2026), diversifying the revenue structure
• Continued expansion of the Packaging Machinery business (up 13.8% year on year, up 10.3% on a local currency basis in FY2026, ending March 2026), strengthening a stable revenue base
• Expanding demand for Shrink Label within Europe (up 6.5% year on year, up 3.3% on a local currency basis in FY2026, ending March 2026)
• Boost to yen-denominated sales and profit from a stronger euro (average euro exchange rate rose 3.1% from ¥164.05 in the prior period to ¥169.19 in the current period)
• Steady strengthening of the existing four businesses and promotion of measures to expand product markets and target areas under the FSG.30 strategy

Risks

• Foreign exchange risk: erosion of yen-denominated sales and profit if the euro weakens (projected rate of ¥170.00 for FY2027, ending March 2027)
• Geopolitical risk: continued geopolitical tensions in Europe potentially affecting demand and the supply chain
• Raw material cost fluctuations: price fluctuations in petroleum-derived raw materials affecting manufacturing costs for Shrink Label and Tack Label
• Reduction in the scope of consolidation and changes to the European business structure following the completion of the liquidation of Fuji Seal Switzerland AG
• Risk of increased compliance costs due to stricter environmental regulations in European countries (such as plastic packaging regulations)
• Potential indirect impact of U.S. tariff policy trends on the supply chain and demand of European customers

Business Details

This regional segment has operations in four countries: Thailand, Vietnam, Indonesia, and India, manufacturing and selling Shrink Label, Soft Pouch, Tack Label, and Packaging Machinery. Although relatively small, accounting for approximately 8.9% of consolidated sales (in FY2026, ending March 2026), the segment turned to sales growth on a local currency basis in FY2026, with operating profit surging 83.7% year on year, leading to a sharp recovery in profitability.

Recent Overview

Sales declined slightly, but operating profit surged 83.7% year on year, sharply improving profitability

In FY2026 (ending March 2026), the ASEAN segment recorded sales of ¥19,424 million (down 0.6% year on year, up 0.8% on a local currency basis), a slight decline in yen terms. Meanwhile, operating profit surged 83.7% year on year to ¥1,722 million (up 86.2% on a local currency basis), with the operating margin sharply improving from 4.8% to 8.9%. While the mainstay Shrink Label grew sales 4.3% on a local currency basis, Packaging Machinery fell sharply by 33.0%. Segment assets expanded to ¥24,219 million, reflecting increased capital expenditure.

Key Products

Growth Drivers

• Continued sales growth in Shrink Label on a local currency basis (up 4.3% in FY2026, ending March 2026), driving overall sales
• Significant improvement in operating margin (from 4.8% to 8.9%) through improved cost structure, leading to a sharp recovery in profitability
• Building a foundation for future growth through aggressive capital expenditure, reflected in the expansion of segment assets (from ¥21,055 million to ¥24,219 million) and a sharp increase in the increase in property, plant and equipment (from ¥616 million to ¥2,119 million)
• Steady strengthening of the existing four businesses and maintenance and development of a local production and consumption structure under the FSG.30 strategy
• Company projects high growth for FY2027 (ending March 2027), with sales expected at ¥21,000 million (up 8.1% year on year)

Risks

• Foreign exchange fluctuation risk (divergence between local currency and yen-denominated figures: FY2026, ending March 2026 sales down 0.6% in yen terms versus up 0.8% on a local currency basis)
• Continued declining trend in Soft Pouch sales on a local currency basis (down 0.6% in FY2026, ending March 2026)
• Order fluctuation risk and skewed product mix, as evidenced by the sharp decline in Packaging Machinery sales (down 33.0% year on year)
• Uncertainty regarding the sustainability of the profitability improvement, as the company projects a decline in operating profit to ¥1,600 million (down 7.1% year on year) for FY2027 (ending March 2027)
• Geopolitical risk and uncertainty in the economic and political conditions of ASEAN countries (Indonesia, Vietnam, Thailand, India)
• Uncertainty regarding the indirect impact of U.S. tariff policy trends on the supply chain and raw material procurement