GIFT HOLDINGS INC.

Business Details

Under the concept of "Turning ramen into a gift to the world!", the company operates domestically and internationally under three core brands: Yokohama Iekei ramen "Machida Shoten", the hearty "Tonzan", and oil noodle brand "Ganso Aburado". The business consists of two divisions: the Directly-Operated Store Business (Domestic and Overseas) and the Produce Business (Domestic, including Overseas FC). The company maintains a stable supply of ingredients and cost advantages through bulk purchasing, backed by an in-house factory network (a domestic 8-factory system comprising 5 noodle-making sites, 1 chashu pork production site, and 2 soup production sites), and has established store-opening know-how that is not constrained by location type, whether near stations, roadside, or in commercial facilities.

Recent Overview

First-half net sales up 23.5% and operating income up 70.6%, representing significant growth in both revenue and profit; full-year forecast revised upward

In the first half of FY2026 (ending October 2026) (November 2025 to April 2026), the company achieved significant growth in both revenue and profit, with net sales of ¥21,239 million (up 23.5% year-on-year) and operating income of ¥2,640 million (up 70.6% year-on-year). Same-store sales (excluding renovated stores) were a robust 102.8% year-on-year, and total store sales were 124.2%. The company opened 14 new directly-operated stores, expanding the number of directly-operated stores to 294 (285 domestic, 9 overseas) at the end of the first half. Produce stores totaled 627, including 577 domestic stores and 20 overseas FC stores. Two companies, DEEP Corporation and Gift Location Co., Ltd., were newly added to the scope of consolidation. In light of the strong first-half results, the company revised its full-year earnings forecast (net sales of ¥43,900 million, operating income of ¥4,800 million). The interim dividend was increased from ¥11.00 in the same period of the prior year to ¥13.00, and the annual dividend forecast is ¥26.00.

Key Products

Growth Drivers

• Continued aggressive new store openings (net increase of 14 directly-operated stores in the first half of FY2026 (ending October 2026), reaching 294 stores at the end of the first half)
• Steady same-store sales performance (first half of FY2026 (ending October 2026): same-store sales up 102.8% year-on-year, total stores up 124.2%)
• Accelerated store openings for Ganso Aburado in city-center and near-station areas (Shinjuku West Exit, Osaka Shinsaibashi underground shopping area, etc.)
• Expansion of overseas directly-operated stores (6-store system in Shanghai, China) and Asian FC business (20 overseas FC stores, with new openings in Australia and Canada)
• Strengthened buying power and cost control through the established 8-factory in-house manufacturing system (responding via rice sourcing region reviews and pork switching)
• Sustained high level of inbound demand supporting robust customer traffic and spending at urban and tourist-area stores
• Maintained profit structure and significantly improved operating margin (from 9.0% to 12.4%) through agile price revisions
• Expansion of group business base through newly consolidated subsidiaries (DEEP and Gift Location)

Risks

• Structural rise in labor costs (minimum wage increases and three consecutive years of shunto wage hikes exceeding 5%) squeezing cost of sales and SG&A
• Persistently high prices for key ingredients such as rice and pork (continued surge in pork prices following the suspension of pork imports from Spain)
• Difficulty securing the appropriate workforce needed to accelerate new store openings (chronic labor shortage in the restaurant industry)
• Risk of renewed spikes in crude oil, energy costs, and logistics costs due to the situation in Iran and tensions in the Strait of Hormuz
• Continued high costs for imported ingredients due to sustained yen depreciation, and decline in consumers' real purchasing power
• Risk of delayed profitability in overseas operations (US and China) and geopolitical risks (US-China relations, tariff policy, Taiwan issue)
• Risk of global economic slowdown due to the Trump administration's tariff policies spilling over into restaurant demand
• Significant decline in the number of inbound visitors from China (down 54.6% year-on-year), contributing to polarization in inbound consumption