Hikari Food Service <138A> operates not only the yakiton restaurant 'Daikuro' and the stand-up drinking 'Ukitsubaki', but also manages the Yokohama family ramen restaurant Kanayama family and the yakiniku Marui butcher shop.

It all started with the opening of the stand-up drinking and yakiton Daikuro (Sumiyoshi store) in Nagoya in 2008. Currently, based in Nagoya, they mainly operate stand-up drinking establishments that cleverly utilize a small space of 10 tsubo without limiting the number of seats. As of the third quarter of the fiscal year ending November 2024, they had 60 stores: (1) Daikuro with 45 stores (24 directly operated stores / 6 commission stores / 15 franchise stores), (2) Ukitsubaki with 11 stores (9 directly operated / 2 commission), (3) Kanayama family with 3 stores (2 directly operated / 1 commission), and (4) Yakiniku Marui butcher shop (1 directly operated). Also, the breakdown of sales for the third quarter of the fiscal year ending November 2024 was 94.4% for directly operated stores, 4.1% for commission stores, 0.8% for franchise stores, and 0.7% for others. The target demographic is mainly in their 30s to 50s, with over 80% of customers falling in this age range. The number of regular customers is 484. The same-store sales increased by 8.5% compared to the same period last year, and the number of directly operated stores remained at 36.

The cumulative revenue for the third quarter of the fiscal year ending November 2024 landed at 1918 million yen, a 17.0% increase from the same period last year. Operating profit decreased by 5.6% to 176 million yen. Although revenue reached a record high for the third quarter, the overlap of opening 2 new stores and renovating 1 store led to a decline in operating profit. They also announced a downward revision of their full-year performance forecast, expecting revenue for the full year to increase by 13.9% to 2533 million yen compared to the previous year, while operating profit is anticipated to decrease by 22.9% to 202 million yen. The delay in store openings, the delayed start of new store operations, and the closure of 3 stores from a single building weighed on the results. However, they have changed this year's new store opening plan from 7 to 10 stores. While the initial plan for new store openings is progressing as planned, they are actively opening new stores as they have found prime locations with favorable conditions, which has led to the inclusion of initial costs and recruitment training costs.

The company's ability to continue expanding its stores in Nagoya, referred to as the 'wasteland of stand-up drinking,' is highly respected. Operating through specialized small-box store formats, they have achieved a high operating profit margin by acquiring small properties that competitors of listed companies do not target, filling gaps in the area through dominant store openings. While local individual stores may pose some competition, they have high hiring efficiency through area-specific recruitment, enabling cost-effective sourcing, resulting in significantly different scales. Additionally, leveraging their repeat visit and 'pub crawl' strategy, they excel in increasing regular customers by implementing services and measures that encourage repeat visits based on the stand-up drinking and small-box store format. They aim to turn staff and store fans into fans of the company as a whole, ultimately increasing the total company-wide visit count, leading to continuous growth in same-store sales, even in stores with long post-opening growth periods.

In the future, they plan to expand the number of stores by focusing on new store openings at a rate 1.1 times higher than the previous year. By stacking the continuous growth of existing stores and the expansion of new store openings, they aim to have 600 stores by 2038. They plan to conduct nationwide area expansions targeting areas around stations with more than 0.16 million passengers per day, actively opening new stores if suitable properties with favorable conditions are found. Furthermore, they recognize returning profits to shareholders as an important management issue. The year-end dividend for the 11-month period of fiscal year 24 is planned to be 40 yen per share, including a regular dividend of 20 yen per share and a commemorative dividend of 20 yen per share. Overall, attention should be paid to the solid growth in the number of stores.