Daiwa Co.,Ltd

Business Details

A department store business operating two stores: Korinbo Store in Kanazawa City and Toyama Store in Toyama City. The business handles a wide range of merchandise including clothing, personal accessories, sundries, household goods, and food products, and is advancing the deepening of relationships with key customer segments and the acquisition of next-generation customers, centered on strengthening the development of products and initiatives unique to the company within the region. Sales under the revenue recognition standard continue to show a declining trend, but total sales (gross basis) have maintained a resilient trajectory. Pop-up events for luxury brands targeting corporate/VIP sales customers are held periodically to address genuine-quality-oriented customer needs.

Recent Overview

Sales on a revenue recognition basis declined slightly, but total sales (gross basis) remained resilient at +0.6% year-on-year

For Q1 FY2027 (ending March 2027) (March to May 2026), Department Store Business segment sales (external customers) were ¥3,475 million (-1.6% year-on-year), and segment profit was ¥115 million (-20.1% year-on-year), reflecting both lower sales and lower profit. On the other hand, total sales (gross basis) before application of the revenue recognition standard rose to ¥9,749 million (+0.6% year-on-year). At Korinbo Store, initiatives included the opening of the "Swatch Store Kanazawa" limited-period pop-up shop, the first such store in the Hokuriku region, and the introduction of "Kobe Korokke," while at Toyama Store, initiatives included strengthening the fresh fish section and enhancing the product lineup for the Grand Hokkaido Fair. Amid a recovering trend in inbound demand and increasingly active spending by affluent domestic customers, sundries (+5.1%), personal accessories (+5.2%), and household goods (+3.6%) grew, while clothing (-3.2%) and food products (-2.1%) fell below the prior-year level.

Key Products

Growth Drivers

• Strengthening the development of proprietary products and initiatives aimed at deepening relationships with key customer segments (high-spending customers) and acquiring next-generation customers
• Initiatives to acquire new customer segments capturing the recovery trend in inbound demand (such as attracting brands opening their first Hokuriku store)
• Addressing genuine-quality-oriented needs through luxury brand pop-up events targeting corporate/VIP sales customers
• Strengthening the lineup of specialty gourmet foods and popular sweets at food and regional product events (such as the Grand Hokkaido Fair)
• Improvement in sales composition driven by steady growth in the sundries, personal accessories, and household goods categories

Risks

• Continued uncertainty in the operating environment due to escalating geopolitical risks and various cost increases
• Growing consumer thrift orientation and outflow of spending to major metropolitan areas
• Cooling of consumer sentiment due to rising prices
• Profit pressure from increased costs such as energy resources and logistics expenses
• Impact on customer traffic and sales from natural disaster risks (such as severe cold waves)
• Spillover of Group risk, including debt guarantees provided to consolidated subsidiary Kanazawa New Grand Hotel Co., Ltd.