Ohsho Food Service FY26 Sales Hit Record ¥116.8bn; Operating Profit Eases 4.5% as Costs Bite, Tops ¥10bn for Third Year

Ohsho Food Service Corporation (TSE: 9936), the operator of the nationwide "Gyoza no Ohsho" Chinese-cuisine restaurant chain, reported consolidated full-year results for the fiscal year ended March 31, 2026 (FY3/2026) under Japanese GAAP. Net sales rose 5.2% year-on-year to a record ¥116,838 million — the company's fourth straight all-time high and its fifth consecutive year of revenue growth. Operating profit, however, eased 4.5% to ¥10,410 million under the weight of rising costs, ordinary profit fell 5.4% to ¥10,702 million, and net profit attributable to owners of the parent declined 7.5% to ¥7,470 million, a drop of ¥601 million. Basic EPS came in at ¥140.84 versus ¥142.88 a year earlier.

Record top line, but cost inflation trims margins

Sales growth was underpinned by an extraordinarily long run of strength at the counter: monthly same-store sales set a fresh record for the same month 49 months in a row through February 2026. Against that, the operating environment was demanding. Management cited higher personnel costs, persistently elevated raw-material prices and rising store-construction and equipment costs as the principal drags on profit. Even so, operating profit broadly held the record level reached the prior year and topped ¥10 billion for the third consecutive year. The 5.4% decline in ordinary profit partly reflected a tough comparison with the prior year, which had included one-off insurance proceeds.

Store network reaches 728; overseas debut in Taiwan

The chain operates as a single Chinese-cuisine segment. During the year Ohsho opened 2 directly-operated and 6 franchise outlets and closed an equal 2 directly-operated and 6 franchise outlets, leaving the network at 728 stores at year-end — 551 directly-operated and 177 franchised. New openings included Kameido (May 2025), Hanshin Amagasaki (September) and BLiX Chigasaki (November), with management flagging roughly 300 candidate sites screened for an accelerated push into the Tokyo metropolitan and eastern-Japan regions, in line with its medium-term "1,000-store" target. In April 2026 the company set up an overseas business office and opened its first international outlet in Taichung, Taiwan.

Balance sheet shrinks on ¥14.5bn buyback

The balance sheet contracted sharply after a substantial return of capital. In May 2025 Ohsho repurchased 4,200 thousand treasury shares for ¥14,490 million and cancelled 5,000 thousand shares. As a result, total assets fell 11.9% to ¥85,087 million and net assets declined 12.4% to ¥65,069 million, with the equity ratio easing only marginally to 76.5% from 76.8% — still a notably strong capital base. Interest-bearing debt stood at ¥3,000 million. Operating cash flow eased 4.5% to ¥10,709 million on the lower pre-tax profit, investing outflows rose to ¥4,774 million (chiefly property and equipment), and financing outflows swelled to ¥19,538 million driven by the buyback. Period-end cash and equivalents fell ¥13,592 million to ¥24,527 million.

Dividend lifted to record ¥56; FY27 guides record sales

Reflecting a payout policy anchored to a target dividend-on-equity (DOE) ratio, the FY3/2026 annual dividend was set at a record ¥56 per share (¥28 interim + ¥28 year-end), the fifth consecutive year of increases, subject to approval at the June 25 shareholders' meeting. For FY3/2027, management plans to maintain the ¥56 annual dividend (¥28 + ¥28). Full-year FY3/2027 guidance targets fresh records in both sales and operating profit: net sales of ¥121,357 million (+3.9%), operating profit of ¥10,951 million (+5.2%) and ordinary profit of ¥11,036 million (+3.1%). Net profit attributable to owners is guided to ¥7,096 million (-5.0%), as the company absorbs higher corporate taxes from a tax-law revision. A net 16-store increase is planned (15 directly-operated and 3 franchise openings against 1 directly-operated and 1 franchise closure). The company reported no material subsequent events.

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