Yonex — Company History

From fishing floats to a late entry into badminton racquets

Yonex begins in a family trade: in 1946 Yoneyama Minoru (米山稔) started manufacturing and selling wooden goods, floats for fishing tackle among them, as Yoneyama Mokkosho in Koshiji, Mishima-gun, Niigata Prefecture (today part of Nagaoka, Niigata). The post-war revolution in materials replaced wooden products such as fishing floats with synthetic resin, and with the earnings base of the family business shrinking, in 1957 Yoneyama chose to enter — late — the OEM manufacture of badminton racquets. In June 1958 he incorporated Yoneyama Seisakusho Co., placed its head office in Koshiji, and put the manufacture and sale of wooden racquets on a proper footing.

The mainstay of the founding years was contract manufacture for British and American distributors: a subcontracting model that exported not under a brand of its own but under the marks of foreign retailers. Before long, however, a principal customer went bankrupt, and the risk of being pulled down with it prompted the decision to change course and build the company’s own brand.

The switch to an own brand, and a two-pole structure across Tokyo and Niigata

In November 1961 the company opened a Tokyo sales office in Taito-ku, Tokyo, organised its domestic and export sales departments there, and began selling under its own brand. It was the first step in shifting control of distribution from an OEM subcontracting model to a brand of its own, and it came in only the third year of the company’s life. That December the first plant at the head office (today the Niigata plant) was built in Koshiji, giving Yonex its main production base. In April 1963 the trading arm was separated out as Yoneyama Sports Co. (today Yonex’s overseas sales department), strengthening the export business.

In June 1965 the company established Minoru Sports Ltd. (today the Yonex Tokyo plant) and began manufacturing and selling shuttlecocks, bringing both racquets and shuttles in house. In February 1967 Yoneyama Seisakusho Co. was renamed Yoneyama Racquet Co., and in September 1968 the Yoneyama Racquet Tokyo plant was built at Yashio, Minami-Saitama-gun, Saitama Prefecture, expanding shuttlecock capacity. By the late 1960s the two-plant structure — racquets in Niigata, shuttles in Saitama — was set.

Tennis, and internationalisation under the YONEX mark

In January 1969 the first plant at the head office was extended and tennis-racquet manufacture began. The move from badminton alone into tennis was a counter to the Taiwanese-made racquets then spreading through the market: staying a badminton specialist risked losing ground to cheap Taiwanese goods. In July 1971 the Tokyo sales office moved to Bunkyo-ku, Tokyo (the site of the present head office) and was elevated to the Tokyo head store. In January 1974 Yoneyama Racquet Co. was renamed Yonex Sports Co., and at the same time the company filed the trademark YONEX. With overseas expansion in view, it was a decision to trade a local name that foreigners found hard to pronounce for one the international market could read.

In July 1978 an Osaka branch office (today the Osaka branch) was opened in Tennoji-ku, Osaka, and in July 1981 the sales subsidiary YONEX SPORTS GmbH was established in West Germany, setting the bridgehead for direct expansion into the European market. In July 1982 Yonex Sports Co. was renamed Yonex Co., Ltd., and at the same moment the company entered the golf business, launching clubs in new materials. Unifying brand and corporate name as Yonex was a decision taken in preparation for overseas expansion, and golf joined badminton and tennis as a third business. In February 1983 the Yonex Tokyo plant began manufacturing strings, and in August 1983 the subsidiary YONEX AMERICA INC. was established, taking the company directly into the United States market. YONEX U.K. LIMITED followed in Britain in March 1987, and in July of the same year the manufacturing company YONEX TAIWAN CO., LTD. was established — a directly owned sales and production network across Europe, America and Asia assembled in six years.

In April 1990 the head office moved to 3-23-13 Yushima, Bunkyo-ku, Tokyo, and the two companies Yonex Tokyo Plant and Yonex Trading were absorbed by merger; thirty-two years after its founding, the two-pole structure of a Tokyo head office and Niigata production was fixed. In February 1994 the company listed on the Second Section of the Tokyo Stock Exchange, making its capital-market debut thirty-six years after it began. The family trade that started in 1957 with fishing floats in Koshiji, Niigata had passed through diversification from badminton alone into tennis and golf and the building of a directly owned sales and production network across Europe, America and Asia, and now reached the point of connecting to the capital markets as a listed company.

The first handover, from Yoneyama Minoru to his younger brother Kosaku

In 1997 the founder, Yoneyama Minoru, then 72, handed the presidency to his younger brother Yoneyama Kosaku (米山宏作), the first generational succession in the company’s thirty-eight years. Yoneyama Kosaku led as president for the ten years from 1997 to 2007, broadening the business base in the wake of the listing and building out the network of overseas subsidiaries. In January 1996 the subsidiary YONEX CORPORATION U.S.A. was established in the United States, taking over the operations of the former YONEX CORPORATION and reorganising the North American structure. In July 1996 the Yonex Teradomari Country Club opened for business, realising the golf-course operation that Yonex Kaihatsu — founded in April 1989 — had been pursuing in Niigata Prefecture.

The collapse of the bubble sapped demand for golf, however, and Teradomari Country Club could not secure the utilisation it had been built for; a later revaluation of the sports business led to an impairment charge. From the listing in February 1994 onward, demand for ski and golf goods stayed weak, and FY05 (the year to March 2006) closed with consolidated sales of $312.3M (¥34bn), ordinary profit of $14.5M (¥2bn) and a net loss of $47.2M (¥5bn) — the first net loss since the listing. Extraordinary losses from the revaluation of overseas subsidiaries weighed on the result, and structural reform was carried out in the closing phase of Yoneyama Kosaku’s tenure. The golf-course business that the founder, Minoru, had begun in 1989 alongside the building of the directly owned network across Europe, America and Asia had, under his brother Kosaku, turned into an impairment in the aftermath of the bubble.

Twenty years under Yoneyama Tsutomu and Hayashida Soju, and the logistics rebuild

In 2007 the presidency passed from Yoneyama Kosaku, the second president, to Yoneyama Tsutomu (米山勉), the eldest son of the founder Yoneyama Minoru and the third president. Yoneyama Tsutomu led as president for the eight years from 2007 to 2015, running the company through the market’s recovery after the Lehman shock. Consolidated sales grew 1.2 times over eight years, from $304.4M (¥35bn) in FY06 (the year to March 2007) to $438.5M (¥43bn) in FY13 (the year to March 2014), holding a recovery track from FY07 through FY13. In July 2010 YONEX GOLF CHINA CO., LTD. was established as a directly owned base in China. In December 2010 the American subsidiary YONEX CORPORATION U.S.A. was renamed YONEX CORPORATION, and in August 2011 the Canadian subsidiary YONEX CANADA LIMITED was liquidated and its operations consolidated into YONEX CORPORATION.

In 2015 the presidency passed from Yoneyama Tsutomu, the third president, to Hayashida Soju (林田草樹), the fourth president and the first from outside the founding family. After three consecutive handovers within the family — Minoru, Kosaku, Tsutomu — this was a switch to a president from outside, an appointment that brought an external perspective into management concentrated in the founder’s family. Hayashida Soju led as president for the seven years from 2015 to 2022, and consolidated and streamlined the distribution network through the East and West Japan distribution centres opened in November 2014, which merged the national logistics sites into two. Consolidated sales grew 1.30 times over five years, from $449.7M (¥48bn) in FY14 (the year to March 2015) to $568.8M (¥62bn) in FY19 (the year to March 2020), and operating profit was restored to a peak of $37.7M (¥4bn) in FY16 (the year to March 2017), a margin of 6.8 per cent. From the year to March 2016 the company invested aggressively in advertising through contracts with world-class players, using their performances as the starting point for spreading brand recognition.

The COVID shock, and the return to a third-generation family president

In June 2019 the Niigata production headquarters was renamed the Niigata plant. In December 2019 President Hayashida Soju acquired additional shares in Toyo Zoki Co., Ltd. (today Yonex Seiki Co., Ltd.), making it a wholly owned subsidiary and bringing in house the die technology that racquet manufacturing requires. From March 2020, however, the COVID shock struck directly through cancelled sporting events and the suspension of activity: consolidated sales in FY20 (the year to March 2021) fell 16.8 per cent year on year to $483.2M (¥52bn), and operating profit sank to $9.4M (¥1bn), a margin of 2.0 per cent. It was a period that exposed the fragility of a sporting-goods maker whose demand has been triggered, since its founding, by international tournaments and the performances of the players it sponsors.

In December 2021 the company acquired shares in the tennis-ball manufacturer BRIDGESTONE TECNIFIBRE CO., LTD. (today YONEX TECNIFIBRE CO., LTD.), making it a subsidiary and taking Yonex into the tennis-ball business. In June 2022 the presidency passed from Hayashida Soju, the fourth president, to Arisa Yoneyama (米山有沙), the fifth president and a granddaughter of the founder Yoneyama Minoru. Arisa was 34 at the time, and the return to a third-generation member of the founding family together with the appointment of a young woman as chief executive drew attention among listed Japanese companies. A graduate of Berkeley in the United States, she stated at the point of her appointment that she would concentrate on North America and India.

A record ¥138.3bn, with East Asia still dominant

FY21 (the year to March 2022), immediately after Arisa Yoneyama took office as fifth president, brought consolidated sales of $678.6M (¥75bn), up 44.4 per cent year on year, and operating profit of $61M (¥7bn), 6.5 times the previous year — a recovery to pre-COVID levels. FY22 (the year to March 2023) followed with sales of $814.5M (¥107bn) and operating profit of $76.9M (¥10bn); FY23 (the year to March 2024) with $828.4M (¥116bn) and $82.6M (¥12bn); and FY24 (the year to March 2025) with $912.9M (¥138bn) and $93.7M (¥14bn) — a fourth consecutive record year for revenue since her appointment. From the COVID trough of $483.2M (¥52bn) in FY20, sales expanded roughly 2.7 times in three years.

What drove the reversal was the international calendar, the Paris Olympics of 2024 among it, and the results of Yonex-contracted players in both badminton and tennis. The resumption of tournaments and the performances of top players revived the sports market and lifted demand for Yonex racquets, shuttles and strings. Since its founding, Yonex’s earnings structure has taken international tournaments and the success of sponsored players as the trigger of demand: under COVID, cancelled events pushed sales down; in the recovery, resumed events and winning players drove them up. The same earnings structure moved revenue in both directions across three years, according to the demand environment.

The regional mix, on the other hand, remains lopsided. FY24 sales by region were Asia 49.2 per cent, Japan 42.0 per cent, the Americas 5.0 per cent and Europe and elsewhere 3.8 per cent — nine-tenths concentrated in Asia and Japan. The focus on North America and India that Arisa Yoneyama declared on taking office depends on how far she can build on a present as small as 5.0 per cent in the Americas and 3.8 per cent in Europe and elsewhere. A Berkeley graduate who became president in 2022 at the age of 34, she is a granddaughter of the founder Yoneyama Minoru and the third generation of the family; at her inaugural press conference she named North America and India as the markets with the greatest room to grow. Whether she can widen the roster of sponsored players and brand recognition in the Americas and Europe, and correct the tilt towards East Asia over the medium term, is her next task.

Recovering an investment that chose Niigata over dispersal abroad

Since taking office, Arisa Yoneyama has published the company’s medium-term direction under the name Global Growth Strategy (GGS). Its aims fall into four points: first, regional composition — diversifying from a base centred on East Asia towards South-East Asia, India and beyond; second, manufacturing — customer-led product development through high-performance, high-quality goods; third, the building of a global IT infrastructure; and fourth, the globalisation of its people. On the reading that the scale of the business has expanded and our customers have expanded globally too (FY24 results presentation), Yonex chose not to disperse production overseas but to invest in facilities centred on its production base in Nagaoka, Niigata Prefecture.

The substance of that investment is concentration in Nagaoka. In July 2024 the company opened a research and development facility, the Yonex Performance Innovation Center, on land adjoining the Nagaoka plant, gathering into one place the R&D functions that had been split across sites. Alongside it, construction began on a new tennis-racquet plant in Nagaoka, Niigata Prefecture, due for completion in spring 2025, expanding capacity in the tennis business. Cash flow from investing activities in FY24 (the year to March 2025) was minus $38M (¥6bn), spent on the research and development facility, the new tennis-racquet plant, and capacity and maintenance investment. The intention is to draw production of tennis — the second pillar after badminton — into Niigata, and to gather volume manufacture and research in the same place.

For sixty-eight years since its founding in 1957, Yonex has kept its main production base in Koshiji, its birthplace, now part of Nagaoka. The GGS capital plan, which gathers research, development and volume manufacture into Niigata rather than dispersing production abroad, is a choice that carries that long-standing policy forward. It is a design meant to hold brand competitiveness through quality; how much of the several years of investment in expanded tennis production and concentrated R&D can be recovered in margin will be confirmed in results from FY25 (the year to March 2026) onwards. Whether the decision to concentrate in Niigata rather than disperse abroad succeeds is the next earnings question for Arisa Yoneyama, who has already renewed the company’s record profits.

A shareholder base moving from the founder’s own holdings to foundations and foreign investors

On returns to shareholders, the company maintains a stable medium- to long-term dividend with a DOE (dividend on equity) ratio of around 3 per cent as its yardstick. The annual dividend for FY24 (the year to March 2025) was raised from ¥16 to ¥22 a share, and the FY25 (year to March 2026) forecast is ¥24 — increases in step with the expansion of earnings. Even as sales grew from $483.2M (¥52bn) in FY20 to $912.9M (¥138bn) in FY24, the company has chosen to set a fixed rate against shareholders’ equity rather than return profits in a lump sum linked to the profit figure. Given that the record profits rest in part on a one-off market recovery, it is a design that separates the dividend level from the swings in earnings.

The founding family’s holding structure has changed as well. The personal holdings of the founder Yoneyama Minoru, who died in 2019, have been progressively transferred to the Yonex Sports Foundation (11.06 per cent, the largest shareholder) and the Niigata Prefecture Sports Promotion Yoneyama Minoru Foundation (4.66 per cent), both public-interest foundations. Shares once held personally by the founder have passed to foundations charged with promoting sport. At the same time the holding ratio of foreign corporations and others rose from 20.58 per cent in FY23 (the year to March 2024) to 26.96 per cent in FY24 (the year to March 2025), as overseas institutional investors increased their positions. The structure is moving towards two shareholder layers standing side by side: the founding family and its foundations, and foreign investors.