Morinaga Milk Industry Co (2264) Q1 2026 earnings summary

Executive summary

• Net sales for 1Q FYE March 2026 rose 2.2% year-over-year to ¥143.7 billion, driven by price revisions and strong global business performance, especially at MILEI.

• Operating profit increased 4.3% year-over-year to ¥8.8 billion, despite higher raw material and logistics costs.

• Profit attributable to owners of parent surged 30.1% year-over-year to ¥6.9 billion, reflecting improved profitability in global operations.

• Domestic business faced volume declines in key categories due to high food prices, but cost controls and strong ice cream and commercial dairy sales offset some of the impact.

• Global business, led by MILEI and overseas probiotics and formula milk, delivered significant profit growth, outpacing forecasts.

Financial highlights

• Net sales: ¥143.7 billion (+2.2% YoY); Operating profit: ¥8.8 billion (+4.3% YoY); Ordinary profit: ¥9.5 billion (nearly flat YoY); Profit attributable to owners of parent: ¥6.9 billion (+30.1% YoY).

• Gross profit reached ¥34.7 billion, up from ¥34.0 billion year-over-year.

• Basic earnings per share increased to ¥82.90 from ¥61.54 year-over-year.

• Comprehensive income dropped to ¥2.6 billion from ¥8.8 billion year-over-year, mainly due to negative foreign currency and pension adjustments.

• Extraordinary income of ¥2.2 billion from gain on abolishment of retirement benefit plan.

Outlook and guidance

• Full-year forecast unchanged: Net sales ¥580.0 billion (+3.4% YoY), operating profit ¥32.0 billion (+7.9% YoY), profit attributable to owners of parent ¥19.0 billion (+248.0% YoY).

• Focus on expanding growth areas (probiotics, formula milk) and executing price revisions in response to higher milk prices.

• Dividend per share forecast to rise to ¥93, targeting a 40% payout ratio.

• Operating profit margin target set at 5.5% for FY2026, with a global business sales ratio of 12.5%.