Sagami Holdings Corporation

Business Details

The Group operates a single reportable segment, the "Restaurant Business," comprising four divisions: Washoku Mensho Sagami, Ajino Mingei, Dondon-an, and Others (Jyuwari Soba Nidaime Chosuke, Kakiage Jyuwari Soba Chosuke, etc.). The Group operates a total of 274 directly-managed and franchised stores (as of the end of FY2026 (ending March 2026)) both domestically and overseas, with its business value centered on providing washoku (Japanese food) culture built around "soba," "Nagoya cuisine," and "hand-stretched udon." Under its management policy of "enhancing deliciousness and hospitality" and "pursuing value delivered through food," the Group aims for sustainable growth through DX, labor-saving initiatives, and ESG promotion.

Recent Overview

In FY2026 (ending March 2026), the company achieved significant year-on-year growth in both net sales and operating profit for the second consecutive year

In FY2026 (ending March 2026), the company achieved significant profit growth, with net sales of ¥39,359 million (up 12.3% year on year), operating profit of ¥2,977 million (up 44.6%), and ordinary profit of ¥3,046 million (up 42.6%). Growth was driven by the Washoku Mensho Sagami division's 50th-anniversary initiatives, which lifted existing-store sales by 6.6% and average customer spend by 8.4%. Meanwhile, an impairment loss of ¥751 million (versus ¥376 million in the prior period) was recorded as an extraordinary loss. For FY2027 (ending March 2027), the company forecasts net sales of ¥40,500 million (up 2.8%), while operating profit is expected to decline 19.4% to ¥2,400 million, suggesting continued cost pressures ahead.

Key Products

Growth Drivers

• Growth in existing-store sales (up 6.6% year on year) at the Washoku Mensho Sagami division driven by 50th-anniversary campaigns and aggressive promotional measures utilizing TV commercials, social media, and the official app
• Sales boost from higher average customer spend (up 8.4% year on year at the Washoku Mensho Sagami division)
• Continued new store openings (18 new stores opened during the period, expanding the group's store count to 274)
• Recovery in restaurant demand driven by expanding inbound tourism demand and improving income and employment conditions
• Productivity gains and improved store operational efficiency through the introduction of digital equipment and fully automated checkout systems using AI-based automatic recognition
• Improved store comfort and reduced costs through better air-conditioning efficiency achieved by installing heat-shielding glass and heat-shielding film

Risks

• Increased costs and expenses due to rising raw material prices and utility costs (cost of sales increased from ¥11,191 million in the prior period to ¥12,416 million in the current period)
• Increased selling, general and administrative expenses due to rising personnel costs (wage increases, higher starting salaries for new graduates, etc.) (SG&A expenses increased from ¥21,784 million in the prior period to ¥23,965 million in the current period)
• Impact on customer traffic from consumers' increasingly frugal and selective spending amid continued price inflation (existing-store customer traffic in the Washoku Mensho Sagami division fell 1.6% year on year)
• Risk of impairment losses (the company recorded an impairment loss of ¥751 million in FY2026 (ending March 2026), roughly double the ¥376 million recorded in the prior period)
• Uncertainty over the global economic outlook due to geopolitical risks and U.S. tariff policy
• The FY2027 (ending March 2027) earnings forecast anticipates a significant decline in operating profit of 19.4% year on year (to ¥2,400 million), raising concerns about continued cost pressures