Yokohama Reito has written off almost all of its outstanding funding to Hofseth International AS, its Norwegian salmon partner, and the accounting hit turns a forecast profit for the year to September 2026 into a loss. The company booked a ¥23.6bn valuation loss on investment securities and a ¥0.5bn allowance for doubtful accounts. Its supplementary slides put the total special loss at ¥24.2bn, covering shares, bonds and loans.
The company said it judged the real value of its Hofseth holdings to be far below book value and treated essentially the whole balance of funding to Hofseth and its affiliates as a loss.
A loss that stops at the bottom line
Yokohama Reito now forecasts a consolidated net loss attributable to owners of the parent of ¥13.8bn, against a previous forecast of a ¥6.3bn profit, or a loss of ¥230.87 per share versus earnings of ¥106.62. The prior year's profit was ¥1.98bn. On a non-consolidated basis the revised forecast is a net loss of ¥14.5bn.
| Line | Previous forecast | Revised forecast |
|---|---|---|
| Net sales | ¥125.0bn | ¥130.5bn |
| Operating profit | ¥7.0bn | ¥7.1bn |
| Ordinary profit | ¥6.4bn | ¥6.6bn |
| Net profit attributable to owners of the parent | ¥6.3bn | Loss of ¥13.8bn |
The revision is not all in one direction. Sales were raised to ¥130.5bn from ¥125.0bn, operating profit to ¥7.1bn from ¥7.0bn and ordinary profit to ¥6.6bn from ¥6.4bn. The company said those lines were broadly on plan and that the revision reflects the Hofseth charges plus items from its 24 September disclosure on debt and share transfers: a ¥4.7bn reversal of a debt-guarantee loss provision, a ¥2.5bn bad-debt loss and a ¥0.5bn gain on sale of investment securities.
The company said the write-down has no effect on sales or operating profit and involves no cash outflow. Total assets fall by ¥29.9bn: ¥24.2bn from the special loss and ¥5.7bn from a lower valuation difference on other securities. The dividend forecast is unchanged.
What was put in, and what came back
The company's slides trace cumulative funding to the Hofseth group since 2015 at about ¥44.9bn. About ¥19.8bn has been recovered, and cumulative interest and dividend income came to about ¥9.7bn. The remaining balance was about ¥25.1bn. The company said it has not expanded funding to the group since 2020 and had treated the relationship as a recovery phase.
The company attributes the deterioration to external factors: salmon price swings since 2024, and lower trading volume in Norwegian products after 2025 US tariff policy left them facing higher tariff rates than competing countries. It also cites a heavier interest burden at Hofseth as its funding needs grew. Hofseth posted net losses for its years ended December 2024 and December 2025 and for the second quarter of the year to December 2026. Yokohama Reito will keep buying from Hofseth, limited to goods for its food sales business.
Pay cuts and a new board structure
For three months from November 2026, the president will return 50% of base director pay, managing directors 30% and other full-time directors 20%. Performance bonuses for the year to September 2026 will not be paid to any eligible director or executive officer.
In a separate disclosure, the board decided to move from an audit and supervisory board company to an audit and supervisory committee company, subject to shareholder approval of the required articles changes at the annual meeting planned for December 2027. It has set up a board secretariat and is considering adding an outside director at the meeting planned for December 2026. Details of the articles changes and the director elections are to follow.
The company also said it will set stricter investment criteria and will not invest in overseas food companies during its new medium-term plan, from 1 October 2026 to 30 September 2030. It added that, with Hofseth's balance almost wholly impaired, it has essentially no other overseas holding likely to need a charge of this size. It does not regard the controls it put in place after its November 2024 overseas loss as deficient, but called two such losses a serious matter.