Supplementary Explanation Materials for Q1 FY2026 Earnings

Performance Overview

Net sales for the first quarter of FY2026 reached JPY 8,710 million (6.2% YoY increase), driven by strong performance in the core candy and gummy categories. Operating income was JPY 1,399 million (0.2% YoY increase), maintaining approximately the same level as the previous year, while quarterly net income was JPY 993 million, also at prior year levels. Gross profit margin improved to 43.5% (0.5 percentage points YoY increase), and operating margin rose to 16.1% (1.0 percentage point YoY increase). In the candy category, seasonal limited editions and new series performed well, and in the gummy category, increased sales of the main brand “Pure Gummy” contributed positively.

Outlook and Market Trends

There is no change to the full-year earnings forecast, which anticipates net sales of JPY 36,500 million (5.0% increase YoY) and an operating margin of 13.4%. Although the impact of raw material price fluctuations and energy costs remains uncertain, the company plans to offset cost increases through price revisions. The overall candy market grew by 2.8%, and the gummy market expanded by 5.7%, showing steady trends. In global operations, growth is being pursued through the establishment of Kanro America Inc. in the US and launching new products. Capital expenditures include around JPY 13 billion planned for expanding the new gummy production line, targeted to commence operations in July 2027.