Fujiya Falls to a First-Half Loss as Cocoa and New Plant Costs Erase a 4.8% Revenue Gain

Revenue grew; the gross margin did not

Fujiya Co., Ltd. (TSE: 2211) published consolidated results for the six months to June 30, 2026 on July 28, 2026 under Japanese GAAP. Revenue rose 4.8% to ¥59,410 million, but cost of sales rose 8.9% to ¥41,399 million, so gross profit fell 3.6% to ¥18,010 million and the gross margin narrowed to 30.3% from 32.9%. With selling, general and administrative expenses up only 1.4% at ¥17,713 million, that squeeze is the whole story: operating profit fell 75.3% to ¥297 million and ordinary profit 73.1% to ¥458 million.

Below that, the loss is arithmetic rather than drama. An extraordinary loss of ¥48 million on fixed-asset disposals left pre-tax profit at ¥409 million; income taxes took ¥309 million and non-controlling interests a further ¥174 million, leaving a net loss attributable to shareholders of ¥74 million against a ¥836 million profit a year earlier. Loss per share was ¥2.89 against earnings of ¥32.46. Comprehensive income, which captures currency translation and securities marks, rose 137.0% to ¥614 million. Fujiya Vietnam Co., Ltd. became an equity-method affiliate from the start of this period.

Confectionery grows 8.9% but earns 23% less

The Confectionery segment — packaged sweets and drinks, 72.3% of revenue — grew 8.9% to ¥42,941 million yet its profit fell 23.1% to ¥3,238 million. Country Ma'am carried the volume with an April character collaboration and June seasonal editions using Yubari melon and blueberry; Home Pie ran television spots and entered the snack-with-drinks market with "Home Sakutto"; and Milky marked its 75th anniversary with themed displays and event shops. Within the segment, drinks nearly doubled to ¥2,932 million from ¥1,951 million, helped by natural water from the Fuji Susono plant and a Taiwanese lychee soda. Fujiya (Hangzhou) Foods also grew on e-commerce despite a weak Chinese economy. Profit still fell, because cocoa beans and edible oils cost more and because the new gummy and natural-water equipment brought depreciation with it.

Cake shops shrink, and the loss narrows

Western Confectionery — the cake chain and restaurants — saw revenue fall 4.9% to ¥14,667 million, but its segment loss narrowed to ¥705 million from ¥950 million on product and price revisions and better factory productivity. Footfall was the problem: the chain ended the half with 821 stores, 44 fewer than a year earlier, and customer counts stayed weak through May before recovering. The company leaned on affordability — an "Everyday Reasonable Price" range and April's "New Life Sweets" promotion of premium shortcake — and on new formats, opening nine "Peko-chan milky donut" and "Peko-chan milky time" shops to reach 23. The restaurant business closed unprofitable outlets and also lost revenue. The Other segment, mainly mail-order character goods, slipped 1.3% to ¥1,801 million with profit down 14.0% to ¥294 million.

Balance sheet and unchanged guidance

Total assets fell 4.2% to ¥101,846 million from the December 31, 2025 year-end, mainly on lower receivables and cash; net assets edged down 0.9% to ¥65,486 million, and the equity ratio nonetheless improved to 58.7% from 57.0% because liabilities fell faster, from ¥40,261 million to ¥36,360 million.

Fujiya left its full-year FY12/2026 guidance unchanged: revenue of ¥125,000 million (+4.6%), operating profit of ¥3,200 million (+12.6%), ordinary profit of ¥3,650 million (+1.1%) and net profit of ¥2,100 million (+3.4%), for earnings per share of ¥81.47. That leaves ¥2,903 million of operating profit — 91% of the full-year figure — to be earned in the second half, which is where the confectionery business concentrates its gift and winter seasons. The annual dividend forecast is unchanged at ¥30.00, all payable at the year-end.

JapanStockPulse provides informational content only and does not constitute investment advice. Figures are taken from the company's published earnings short report and may be subject to subsequent revision.