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Introduction & Market Context
GIFT HOLDINGS INC. (9279), a leading Japanese ramen restaurant operator, reported strong third-quarter results for the fiscal year ending October 31, 2025, with significant growth in both sales and profits. The company’s stock closed at 3,065 yen on September 12, 2025, up 2.28% or 70 yen, reflecting positive market reaction to the results.
The company continues to execute its expansion strategy both domestically and internationally, while also addressing cost pressures through operational improvements. GIFT HOLDINGS was recently selected as a component of the FTSE Japan All-Cap Index, following its inclusion in the JPX-Nikkei Mid and Small Cap Index for two consecutive years, highlighting its growing market recognition.
Quarterly Performance Highlights
For the nine months ended July 31, 2025, GIFT HOLDINGS reported net sales of 26,113 million yen, representing a 26.8% year-on-year increase and achieving 72.5% of its full-year plan. Operating profit reached 2,375 million yen, up 15.1% year-on-year, while ordinary profit increased by 12.1% to 2,378 million yen. Quarterly profit attributable to owners of parent rose 13.7% to 1,575 million yen.
As shown in the following financial summary, the company has made steady progress toward its annual targets despite facing challenges from rising costs:
The company’s quarterly performance shows consistent growth throughout the fiscal year, with the third quarter delivering net sales of 8,917 million yen and operating profit of 828 million yen, representing an operating profit margin of 9.3%. This marks an improvement from the second quarter’s 8.9% margin, indicating the company’s ability to manage costs effectively.
As illustrated in the quarterly trends chart:
GIFT HOLDINGS has successfully addressed unexpected cost increases, particularly in labor costs, by optimizing employee scheduling based on customer numbers rather than sales. This operational improvement has significantly enhanced net sales per labor-hour while maintaining average customer spend without implementing the annual July price increase.
The company also managed to absorb surging raw material costs, particularly for cabbage and rice, through flexible price adjustments, contributing to the improved profitability in the third quarter.
Expansion Strategy and Store Growth
GIFT HOLDINGS continues its aggressive store expansion strategy, adding 60 stores compared to the end of the previous fiscal year. As of July 31, 2025, the company operated a total of 870 stores, including 260 company-owned stores, 575 produced stores, 27 franchise stores, and 8 outsourced stores.
The store count breakdown is visualized in the following chart:
The company’s overseas expansion continues to gain momentum, with a total of 33 stores across multiple countries, representing an increase of 6 stores compared to the end of the previous fiscal year. The company opened its second store in China in July and launched its first European location in Switzerland in August 2025.
The status of overseas operations is summarized in the following slide:
A notable development in the company’s expansion was the simultaneous opening of three of its brands—"Machida Shoten," "GANSO ABURADO," and "NAGAOKA SHOKUDO"—at the South Terrace of Haneda Airport Terminal 1 on August 25, 2025. This strategic location serves domestic flights for Japan Airlines Group, Skymark Airlines, and others, providing significant exposure for the company’s brands.
Medium-term Business Plan and Outlook
GIFT HOLDINGS has upwardly revised its medium-term business plan, reflecting confidence in its growth strategy. The company aims to become a "global leader in delivering the world’s best ramen" by growing its organic business in Japan while aggressively expanding overseas.
The revised plan sets ambitious targets for the fiscal year ending October 31, 2027, including net sales of 52.0 billion yen, operating profit of 5.2 billion yen, and a total of 1,156 stores globally.
As shown in the quantitative plan below, the company expects steady growth across all key metrics:
The upward revision from the previously announced medium-term business plan is illustrated in the following chart, showing significant increases in both net sales and operating profit targets:
To achieve these targets, GIFT HOLDINGS has established clear key performance indicators (KPIs), including net sales growth of 20% or above, operating profit margin of 10.0% or above, ROE of 20% or above, and a dividend payout ratio of 20% or above.
The company’s store opening strategy balances profit maximization with margin maintenance by targeting company-owned stores in densely populated areas with large markets, while opening produced stores in regional areas:
Forward-Looking Statements
For the full fiscal year ending October 31, 2025, GIFT HOLDINGS maintains its forecast of 36,000 million yen in net sales (26.4% year-on-year increase), 3,600 million yen in operating profit (23.7% increase), 3,620 million yen in ordinary profit (21.8% increase), and 2,200 million yen in profit attributable to owners of parent (17.3% increase).
The company plans to open 50 company-owned stores in Japan and 2 overseas, along with 40 franchise and produced stores in Japan and 12 overseas, bringing the total store count to 913 by the end of the fiscal year.
In terms of shareholder returns, GIFT HOLDINGS aims for a dividend payout ratio of 20.0% or more, with both interim and year-end dividends planned at 11.0 yen each, for a total annual dividend of 22.0 yen.
As the company continues to execute its growth strategy, it will focus on expanding existing business, strengthening recruitment, enhancing store opening capabilities, accelerating overseas expansion, strengthening manufacturing and logistics systems, promoting digital transformation, and advancing sustainability initiatives.
Full presentation:
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