Ito En, a leading Japanese beverage maker known for its Oi Ocha green tea, reported an operating profit of 10.2 billion yen ($63.7 million) for the fiscal first quarter, marking a 22% increase year-over-year.
This performance was driven by a 3.3% rise in revenue to 135.18 billion yen, surpassing Citi's forecast of 7.7 billion yen, which had anticipated a decline due to rising raw material costs and expenses from its vending machine operations.
Notably, the vending machine segment achieved a 4% operating profit margin, a significant turnaround from previous losses, contributing over half of the profit beat. The company attributed its improved profitability to lower promotional expenses and reduced depreciation costs.
Additionally, Ito En aims to expand its international presence, targeting over 60 countries by fiscal year 2029, up from 52, as it continues to dominate Japan's green tea market, holding a 25% share of crude tea transaction volumes