Nozaki Insatsu Shigyo Co., Ltd.

Business Details

The Group consists of a single printing business segment, operating through four divisions: (1) Commercial Printing (catalogs, pamphlets, etc.), (2) Packaging Materials and Paper Containers/Paper Products (wrapping paper, paper bags, paper containers, business forms, etc.), (3) Information Equipment and Supplies (barcode printers, tags, labels, etc.), and (4) Others (Chemical Products, etc.) (chemical products, ticket packs, etc.). The Group focuses on the domestic market, manufacturing and selling products through the Group including subsidiaries. The Group is promoting enhancement of corporate value based on the medium-term management plan "nozaki2024/2026 SHINKA."

Recent Overview

All profit items declined by more than 20% year on year due to the reversal of special demand and increased costs

In FY2026 (ending March 2026), net sales were ¥14,016 million (down 3.8% year on year), operating profit was ¥516 million (down 25.2% year on year), and profit attributable to owners of parent was ¥359 million (down 31.2% year on year), with all items falling below the prior period's results. In addition to the reversal of the prior year's special demand from the logistics industry and a decline in selling prices due to price competition, manufacturing costs rose due to persistently high raw material prices, increased personnel expenses from wage hikes, increased factory equipment repair work, and a comprehensive renewal of IT security equipment. The earnings forecast for FY2027 (ending March 2026) has been left undetermined at this time, as naphtha procurement is expected to become unstable due to the potential closure of the Strait of Hormuz stemming from the situation in the Middle East, which is expected to cause delays in the supply of raw materials and auxiliary materials as well as price increases.

Key Products

Growth Drivers

• Increased orders for small and medium-sized printers and customized machines in the Information Equipment and Supplies division (the only division to maintain year-on-year growth, up 0.3%)
• Enhancement of the added value of existing products through "Printing x DX" initiatives
• Strengthening of the production system through active capital investment based on the medium-term management plan "nozaki2024/2026 SHINKA" (acquisition of property, plant and equipment of ¥1,013 million in FY2026 ending March 2026)
• Steady performance of tags and labels for the food industry and the data print business for e-commerce sites
• Enhancement of corporate value through proposals for alternative printing methods utilizing various equipment and the pursuit of low-cost operations

Risks

• Risk of supply delays and price surges for raw materials such as paper and film, as well as auxiliary materials such as diluting solvents for gravure printing and adhesives for tack paper, due to unstable naphtha procurement resulting from a potential closure of the Strait of Hormuz stemming from the situation in the Middle East (the main reason the earnings forecast for FY2027 (ending March 2026) has been left undetermined)
• Structural decline in net sales due to the reversal of the prior year's special demand from the logistics industry and intensifying price competition with other companies in the same industry
• Rising manufacturing costs due to increased personnel expenses from wage hikes and price increases, as well as increased investment in factory equipment repairs and IT security
• Cost pressure from persistently high raw material and energy prices and geopolitical risks (the prolonged Russia-Ukraine situation and the weak yen trend)
• Structural decline in printing demand due to the accelerating shift from paper media to digital (paperless trend)
• Deterioration in the ratio of cash flow to interest-bearing debt (from 3.6 years in FY2025 (ended March 2025) to 6.7 years in FY2026 (ending March 2026)) and a decline in the interest coverage ratio (from 56.7 times to 16.8 times)