Japan Foods Holding Ltd’s Stock Is Up 118% In 5 Years: Here Are 3 Things Investors Should Know About Its Management

 Japan Foods Holding Ltd (SGX: 5OI), which was founded in 1997, is a Japanese restaurant operator. As of 31 December 2017, Japan Foods has 48 restaurants in Singapore under various brands, and 22 restaurants outside of Singapore in Malaysia, Vietnam, Hong Kong, and China. The company’s restaurant brands include Ajisen Ramen, Menya Musashi, and Osaka Ohsho.

Over the past five years, Japan Foods’ stock has delivered an impressive return of 118% including dividends. Investors who have no position in Japan Foods may thus be wondering if they should be hopping onboard, while long-term holders of the company may also be wondering if now’s the time to take some gains off the table.

But, both groups of investors should be doing one similar thing. And that is, they should be trying to understand Japan Foods’ management team. In this article I want to share three aspects of Japan Foods’ management that I find to be interesting.


Members of Japan Foods’ management team typically have long tenure, with many of them having spent more than 10 years with the company.

Executive chairman and CEO, Takahashi Kenichi, has been with the company since 1997 since he is also the founder. Japan Foods’ non-executive vice chairman, Wong Hin Sun, joined the company in 2008. Meanwhile, Japan Foods’ chief operating officer, chief financial officer, head of operations, and chief chef have all been with the company since 2008 or earlier.

Having a long-tenured management team means that Japan Foods is steered by people who have a good understanding of the business. What’s more, these people are likely to be really passionate about the business, since they have been with the company for a long time.


Ideally, we want to see a company’s remuneration be reasonable to attract, retain, and motive its personnel.

In Japan Foods’ fiscal year ending 31 March 2017 (FY2017), Kenichi’s total remuneration was just S$588,000, while the top five management personnel  – excluding Kenichi – was paid a total of S$770,000. In FY2017, Japan Foods earned a net profit of S$4.7 million. Meanwhile, the top three managers at curry puff retailer Old Chang Kee Ltd (SGX: 5ML) were paid in excess of at least S$1.5 million each on average in the company’s last completed fiscal year.

Given all the numbers in the paragraph above, I think the remuneration of key management personnel at Japan Foods is reasonable.


Lastly, I would like to point out that the key managers of Japan Foods are also major shareholders of the company. For example, Kenichi and Wong respectively controlled 70.82% and 5.47% of the company’s stock as of 22 June 2017.

In my view, this high level of ownership aligns Kenichi and Wong’s interests with the other shareholders of Japan Foods, and would thus lead them to strive and make Japan Foods a success over the long run.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned.