Kotobuki Spirits Q1 Operating Profit Jumps 20.7% to ¥4.15 Billion; Company Introduces an Interim Dividend

Kotobuki Spirits Co., Ltd. (TSE: 2222), the maker of premium regional souvenir confectionery sold largely through airports, station buildings and department stores, reported consolidated results for the first quarter of the fiscal year ending March 2027 under Japanese GAAP. Revenue rose 10.0% to ¥18,668 million, operating profit jumped 20.7% to ¥4,152 million, ordinary profit gained 20.3% to ¥4,178 million, and net profit attributable to owners of the parent rose 18.6% to ¥2,731 million. Basic earnings per share were ¥17.69, up from ¥14.92, and the operating margin widened to 22.2% from 20.3%.

Every segment grows

Sucrey Group, the largest unit, lifted revenue 6.8% to ¥8,629 million and operating profit 25.7% to ¥1,641 million. The KCC Group — renamed from "KCC" this quarter after K.C.C. Co., Ltd. established Hakone Tokinomi Co., Ltd. as a wholly owned subsidiary on April 1, 2026 — grew revenue 9.9% to ¥5,376 million and operating profit 16.9% to ¥1,016 million. Kotobuki Seika Group posted the fastest top-line growth, up 12.5% to ¥4,293 million, with operating profit up 23.8% to ¥1,033 million. The sales subsidiaries added 9.7% to ¥1,952 million with operating profit up 32.8% to ¥276 million, while the "Other" segment — a non-life insurance agency, health foods and a confectionery business in Taiwan — grew 48.1% to ¥148 million and narrowed its operating loss to ¥3 million from ¥13 million.

Brand building and new stores

Sucrey Group ran a 10th-anniversary campaign for Butter Butler and pushed the relaunched flagship "Sandwich Cookie" from Cocoris. In the Fukuoka and Nagasaki area it expanded wholesale distribution of "Hakuttarashi," a Hakata souvenir launched in December 2025, and opened a third Tante Annie outlet at Nagasaki Airport in April. It also opened the new brands Mirimiri at Isetan Shinjuku and Hakata Oliori at Daimaru Fukuoka Tenjin in May, and reopened the Tokyo Milk Cheese Factory store at GRANSTA Tokyo in June — three openings against one closure in the quarter.

The KCC Group leaned on LeTAO, promoting the limited-edition "Galenatti" at its Sapporo Daimaru store and "Amignon" at the Otaru Canal Plaza store to build brand value. Metropolitan-area brands such as Pista & Tokyo used limited-run pop-ups to raise awareness, and Okada Kinsei Anbutaya opened at LUMINE Omiya in April. Kotobuki Seika Group focused on new-product development and proposal-based selling to major agents and sales subsidiaries: in Okinawa it expanded OEM work with a major agent and opened a second New Q pineapple-sweets store at Naha Airport in June, while in its home San'in region it drove shelf-space proposals around the flagship "Inaba no Shirousagi." The sales subsidiaries promoted the 10th-anniversary "Ogura Toast Langue de Chat" in Tokai, the new "Osaka Torasando" and seasonal "Osaka Mitarashi Mizu-manju" in Kansai, and the "Hakata Makka Ichigo" brand plus the new Hakata Chikae "Mentai Tempura Senbei" in Fukuoka.

Inbound demand against cost pressure

Management described a gradual economic recovery supported by improving employment and income conditions, but noted that geopolitical risk including instability in the Middle East pushed up raw-material and energy prices, while food-led inflation weighed on consumer spending. Both the Sucrey and KCC groups added sales staff and ran pop-up events at international terminals to expand floor space and capture inbound tourist demand — a key driver for a business built on souvenir purchases. The quarter marks the second year of the medium-term target "Value Up Vision 2030"; the 2026 management slogan is "Create one fanatical fan today," with the focus on Value Up in product strength, sales-floor strength and selling strength, on inbound measures and on human capital.

Balance sheet

Total assets stood at ¥56,299 million at June 30, 2026, down ¥3,843 million from the March year-end, mainly on a ¥3,388 million fall in cash and deposits and a ¥1,687 million decline in notes and accounts receivable, partly offset by a ¥637 million increase in property, plant and equipment. Liabilities fell ¥1,197 million to ¥11,008 million as income taxes payable dropped ¥2,033 million and the bonus provision fell ¥667 million, against a ¥1,492 million rise in other current liabilities. Net assets declined ¥2,645 million to ¥45,290 million, reflecting ¥5,405 million of dividends paid against ¥2,731 million of quarterly profit. The equity ratio nevertheless improved 0.7 points to 80.4%, and book value per share was ¥293.22.

An interim dividend is introduced

Alongside the results, Kotobuki Spirits announced a partial change to its dividend policy under which it will begin paying an interim dividend, and revised its dividend forecast accordingly. The FY3/2027 annual dividend is now guided at ¥45.00 per share — ¥10.00 at the interim and ¥35.00 at the year-end — against ¥35.00 paid in FY3/2026 as a year-end dividend only, a 28.6% increase and a revision to the previously announced forecast.

Full-year guidance unchanged

The company left its full-year FY3/2027 guidance, issued on May 14, 2026, unchanged: revenue of ¥84,500 million (+7.3%), operating profit of ¥20,550 million (+10.5%), ordinary profit of ¥20,610 million (+10.0%) and net profit attributable to owners of ¥13,810 million (+10.0%), for basic EPS of ¥89.42. First-half guidance calls for revenue of ¥38,300 million (+7.0%), operating profit of ¥8,190 million (+10.1%), ordinary profit of ¥8,220 million (+9.3%), net profit of ¥5,500 million (+9.6%) and EPS of ¥35.61. The first quarter already covers about 20% of the full-year operating-profit target. The scope of consolidation gained one new subsidiary, Hakone Tokinomi Co., Ltd.

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.