HOKUTO Corporation (1379): FY2025 Results Summary — Domestic Mushroom Pricing Lifts Sales and Profit

This article is based on publicly available IR materials and is not a recommendation to buy or sell any specific securities.

Note: HOKUTO Corporation labels this period the “Fiscal Year Ended March 31, 2026”; on this site the most recent completed fiscal year is classified as FY2025, and the company’s own labels are retained in the text and tables below. HOKUTO Corporation posted increased revenue and profit for the fiscal year ended March 31, 2026, with sales of 85,915 million yen (up 3.4% year on year) and operating profit of 7,031 million yen (up 6.1%). Ordinary profit rose 17.7% to 8,186 million yen and net profit rose 57.8% to 7,006 million yen. The company states that by maintaining price competitiveness in the domestic market it achieved increased revenue and profit, with sales up 2.8 billion yen and operating profit up 400 million yen year on year, and that securing major contracts in the chemical products business also contributed.

Consolidated Results (Full-Year Actual)

The company describes sales and profit at each stage as performing well, with the balance sheet and cash flow remaining stable. Headline figures presented on the highlights slide are sales of 85.9 billion yen (up 3.4% year on year), operating profit of 7.0 billion yen (up 6.1%), ordinary profit of 8.1 billion yen (up 17.7%) and net income of 7.0 billion yen (up 57.8%). ROIC was 5.29%, up 0.08 pt from the previous year. The profit margin for the mushroom business in Japan was 13% (up 0.2 pt from the previous year), while the profit margin for the mushroom business outside Japan was 14% (down 1.1 pt from the previous year).

Item (Unit: million yen)	Results for FY Ended March 31, 2026	Results for FY Ended March 31, 2025	Change from the Previous Year	Percentage Change
Sales	85,915	83,104	2,810	3.4%
Gross Profit	24,919	23,760	1,159	4.9%
Gross Profit Margin	29.0%	28.6%	—	—
Selling, General, and Administrative	17,888	17,132	756	4.4%
Operating Profit	7,031	6,628	402	6.1%
Operating Profit Margin	8.2%	8.0%	—	—
Ordinary Profit	8,186	6,953	1,233	17.7%
Ordinary Profit Margin	9.5%	8.4%	—	—
Net Profit	7,006	4,441	2,565	57.8%
Net Profit Margin	8.2%	5.3%	—	—
Earnings per Share	223.84 yen	140.63 yen	—	—

On the operating profit bridge, the company moves from 6,628 million yen in the previous year to 7,031 million yen, with an increase in sales of 2,811 million yen offset by an increase in cost of goods sold of △1,652 million yen, an increase in logistics costs of △283 million yen, an increase in sales promotion and advertising expenses of △97 million yen, an increase in labor costs of △185 million yen and an increase in other selling, general, and administrative expenses of △191 million yen. Within cost measures, improved energy management contributed +100 million yen and measures to reduce raw material costs contributed +200 million yen. Mushroom prices year on year were bunashimeji +2.2%, eryngii +3.1%, maitake +1.1% and shimofuri hiratake +7.5%.

Segment Results

The company states that sales targets were met in all segments, and that driven by each domestic segment consolidated operating profit also exceeded projections. The mushroom business in Japan reached 103.7% of its sales plan and 145.6% of its operating profit plan, while the mushroom business outside Japan came in at 87.8% of its operating profit plan.

Segment	Metric (Unit: million yen)	Results for FY Ended March 31, 2026	Results for FY Ended March 31, 2025	Change	Percentage	Plan for FY Ended March 31, 2026	Percentage of Target
Mushroom business in Japan	Sales	56,077	55,100	976	1.8%	54,074	103.7%
Mushroom business outside Japan	Sales	8,236	7,711	525	6.8%	8,208	100.3%
Processed products business	Sales	8,003	8,158	△154	△1.9%	7,863	101.8%
Chemical products business	Sales	13,598	12,134	1,463	12.1%	13,466	101.0%
Mushroom business in Japan	Operating profit	7,242	6,994	248	3.6%	4,974	145.6%
Mushroom business outside Japan	Operating profit	1,147	1,156	△9	△0.8%	1,307	87.8%
Processed products business	Operating profit	511	374	137	36.8%	298	171.4%
Chemical products business	Operating profit	470	337	132	39.2%	375	125.4%

For the mushroom business in Japan, the company reports that area and item strategies together with price stabilization contributed significantly to sales growth, while energy management at its factories helped control costs. Segment results were sales of 56.0 billion yen, operating profit of 7.2 billion yen and an operating profit margin of 13%. Domestic production volume was 78 thousand tons in 26/3. In the chemical products business, sales grew significantly due to the acquisition of large-scale equipment projects in the agricultural materials sector, and the operating profit margin increased by 0.6 percentage points compared to the previous fiscal year.

In the mushroom business outside Japan, the company notes that although sales increased on a yen-converted basis due to the weak yen, actual sales were lower than the previous year, and profit margins declined due to factors such as unsuccessful bids and market price fluctuations. In the United States, sales were 27.74 million USD against 27.64 million USD (up 0.09 million USD, 0.4%), while operating profit was 2.09 million USD against 2.56 million USD (△0.46 million USD, △18.2%), with the operating profit margin at 7.6% versus 9.3%. In Taiwan, sales were NT$645 million against NT$661 million (△NT$16 million, △2.5%) and operating profit was NT$155 million against NT$160 million (△NT$5 million, △3.2%), with the operating profit margin at 24.0% versus 24.2%. In Malaysia, sales were RM13.64 million against RM17.10 million (△RM3.46 million, △20.2%) and operating profit was △RM4.06 million against △RM3.18 million, with the operating profit margin at △29.8% versus △18.6%.

Full-Year Plan for the Fiscal Year Ending March 31, 2027

To achieve the medium-term management plan targets of 100 billion yen in sales and 10 billion yen in operating profit, the company says it will proceed with preparations for the construction of a new plant in the United States while working to strengthen its mushroom business in Japan. On the operating profit bridge for the plan, the company moves from 7,031 million yen to 7,260 million yen, with an increase in sales of 2,185 million yen partly offset by an increase in cost of goods sold of △775 million yen.

Item	Plan for FY Ending March 31, 2027	Results for FY Ended March 31, 2026	Change
Sales	88.1 billion yen	85.9 billion yen	up 2.5% year on year
Operating profit	7.2 billion yen	7.0 billion yen	up 3.3% year on year
Ordinary profit	7.6 billion yen	8.1 billion yen	down 6.6% year on year
Net income	5.2 billion yen	7.0 billion yen	down 25.1% year on year
Dividend amount	62 yen	55 yen	up 7 yen from the previous year
ROIC	5.28%	5.29%	down 0.01 pt from the previous year
Profit margin for the mushroom business in Japan	13%	13%	down 0.1 pt from the previous year
Profit margin for the mushroom business outside Japan	16%	14%	up 2.2 pt from the previous year

By segment, the company expects both sales and profits to increase in the mushroom business outside Japan due to new market development in the United States and price increases. Priority measures listed are regional strategy and marketing initiatives in Japan, expansion in the U.S. market, new proposals in processed products, and strengthening raw material sales in chemical products.

Segment	Metric (Unit: million yen)	Plan for FY Ending March 31, 2027	Results for FY Ended March 31, 2026	Change	Percentage
Mushroom business in Japan	Sales	57,130	56,077	1,052	1.9%
Mushroom business outside Japan	Sales	8,830	8,236	593	7.2%
Processed products business	Sales	8,430	8,003	426	5.3%
Chemical products business	Sales	13,710	13,598	111	0.8%
Mushroom business in Japan	Operating profit	7,300	7,242	57	0.7%
Mushroom business outside Japan	Operating profit	1,420	1,147	272	23.8%
Processed products business	Operating profit	430	511	△81	△16.0%
Chemical products business	Operating profit	530	470	59	12.7%

Shareholder Returns

The annual dividend for the fiscal year ended March 31, 2026 is 55 yen, up 5 yen from the previous year, and the company plans an annual dividend of 62 yen for the fiscal year ending March 31, 2027. The stated basic policy is to strive to maintain stable dividends while securing the internal reserves necessary to prepare for future business expansion. To further expand shareholder returns, the company has decided to implement a dividend policy with the goal of achieving a DOE (Dividend on Equity) of 3.5% in the fiscal year ending March 31, 2029 based on consolidated shareholders’ equity, and targets a DOE of 3.2% for the fiscal year ending March 31, 2027.

Shareholder benefits were also expanded. Shareholders who hold 100 or more shares as of the end of March each year may choose one of three sets: A Health Set, an assortment including Agaricus drink and other items worth 4,000 yen; B Retort Set, an assortment including retort curry and mushroom-seasoned rice worth 1,800 yen; or C Mushroom & Retort Set, an assortment including two types of mushrooms and retort curry worth 1,400 yen. Newly added, shareholders who have continuously held 500 or more shares for one year additionally receive a 3,000-yen Visa gift card.

Medium-Term Management Plan and Topics

For the fiscal year ending March 31, 2029, the final year of the medium-term management plan, the company aims to achieve management targets of 100 billion yen in sales, 10 billion yen in operating profit, an operating profit margin of 10%, a ROIC of 7.2% and a PBR of 1.9x. Current progress stands at 85.9% of the sales target and 70% of the operating profit target, and the company notes a current PBR of 0.92x against the 1.9x target and a current ROIC of 5.29% against the 7.2% target.

On overseas expansion, land has been acquired for the construction of a new factory in California, United States. The stated milestones are land acquisition completed by around March 2026, completion of various applications for the County and its review in mid- to late 2026, design completion in November 2026, completion of various applications for the State of California and its review in mid- to late 2027, and start of production during the third quarter of the fiscal year ending 2029, with the timeline subject to change depending on the progress of regulatory reviews. In Japan, the company acquired shares in Funagata Mushroom Co., Ltd., described as the third-largest button mushroom producer in the industry, making it a subsidiary and expanding its product lineup; that company recorded sales of 1,186 million yen in the fiscal year ended March 31, 2025.

In the processed products business, the company launched “HOKUTO FRESHLY PICKED FROZEN MUSHROOMS” for the retail market in October 2025 using quick-frozen sliced eryngii and sliced bunashimeji mushrooms. In marketing, promotion of shimofuri hiratake mushrooms through a collaboration with “Ryuji’s Buzz Recipes,” in-store campaigns and media PR increased sales by 10%, setting a new all-time high, with total advertising equivalent value of 400 million yen estimated by an external PR firm. On cost reduction, switching to LED lighting for the cultivation and growth processes of maitake mushrooms and introducing a single-fluid humidification process reduced electricity consumption by 2.6% compared to the fiscal year ended March 31, 2025.

Financial Position and Cash Flows

Total assets rose to 113,726 million yen from 107,620 million yen, an increase of 6,105 million yen, with current assets of 40,529 million yen and fixed assets of 73,196 million yen. Total liabilities were 48,802 million yen against 50,811 million yen, and total net assets rose to 64,924 million yen from 56,808 million yen, an increase of 8,115 million yen. Total shareholders’ equity was 59,994 million yen, up 5,573 million yen. Cash flows from operating activities were 10,824 million yen, cash flows from investing activities were △2,917 million yen, free cash flow was 7,907 million yen and cash flows from financing activities were △4,420 million yen. The company notes that consolidated operating cash flow for the fiscal year ended March 31, 2026 is 10.8 billion yen, a decrease of 1.4 billion yen year on year, primarily due to an increase in corporate tax payments.

This article is an analysis based on publicly available information and is not a recommendation to buy or sell any specific securities. Investment decisions are your own responsibility.