Toray Industries, Inc. (TSE: 3402), Japan's leading advanced materials and carbon-fibre group, reported consolidated results for FY2026 (fiscal year ended March 31, 2026) under IFRS on May 13, 2026. Revenue grew a modest 0.9% year-on-year to ¥2,585,077 million (approximately ¥2.585 trillion). IFRS business profit — which strips out non-recurring items such as impairments and restructuring charges — came in nearly flat at ¥141,913 million, a decline of just 0.6% from the prior year's ¥142,762 million. Operating profit, which includes those non-recurring charges, fell sharply by 23.7% to ¥97,221 million (from ¥127,453 million). Pre-tax profit declined 5.9% to ¥107,599 million, while net profit attributable to owners of the parent rose 2.1% to ¥79,521 million — the relative resilience at the bottom line supported by strong equity-method investment income of ¥21,528 million (versus a loss of ¥2,351 million the prior year). Basic EPS improved to ¥52.96 from ¥48.93.
The divergence between business profit (nearly flat) and operating profit (down nearly a quarter) signals that a meaningful wave of non-recurring charges — including asset impairments and restructuring provisions — hit the income statement in FY2026. These items, which are excluded from IFRS business profit but included in IFRS operating profit, depressed the statutory operating figure. Management's preferred headline metric, business profit, suggests the underlying business was essentially in line with the prior year despite a challenging global chemical and carbon-fibre market environment.
Revenue steady; comprehensive income surges on FX and valuation gains
While top-line revenue growth was contained at 0.9%, total comprehensive income surged 392.7% to ¥249,356 million from just ¥50,605 million the prior year, reflecting substantial foreign-currency translation adjustments and other valuation gains flowing through other comprehensive income. Total assets expanded to ¥3,476,976 million from ¥3,292,597 million, and equity attributable to parent shareholders rose to ¥1,800,058 million (book value per share: ¥1,236.45, up from ¥1,092.90). The equity-to-assets ratio was approximately 51.8%.
Cash generation remains solid; operating cash flow at ¥211.8bn
Operating cash flow was ¥211,763 million, down from ¥255,033 million the prior year but still robust in absolute terms. Investing outflows were ¥66,935 million and financing outflows — reflecting dividend payments and share repurchases — totalled ¥128,996 million. The balance sheet ended the year with cash and cash equivalents of ¥265,295 million, up from ¥237,295 million, suggesting ample liquidity to fund the group's ongoing capital expenditure cycle and growth investments in carbon fibre, water treatment membranes, and high-performance films.
Dividend raised to ¥26, including ¥3 commemorative tranche
For FY2026, Toray declared an annual dividend of ¥26.00 per share, comprising a ¥10.00 interim dividend and a ¥16.00 year-end dividend (¥13.00 ordinary + ¥3.00 commemorative). This compares with ¥18.00 the prior year, a substantial increase of ¥8.00 per share. The consolidated payout ratio was 37.8% (versus 36.8%). For FY2027, the company forecasts an interim dividend of ¥13.00 (implying an expected annual dividend increase), with an implied payout ratio forecast of 42.1%, signalling continued shareholder returns progress.
FY2027 guidance: revenue +9.5%, business profit +12.7%
Looking ahead to FY2027 (ending March 31, 2027), Toray guided for revenue of ¥2,830,000 million (+9.5% YoY), business profit of ¥160,000 million (+12.7%), and net profit attributable to owners of ¥90,000 million (+13.2%), implying EPS of ¥61.82. For the first half (H1 FY2027), the company projected revenue of ¥1,370,000 million (+11.0%), H1 business profit of ¥73,000 million (+7.5%), and H1 net profit of ¥40,000 million (+8.3%), with H1 EPS of ¥27.48. These targets represent a meaningful acceleration versus FY2026 actuals and suggest management expects the non-recurring headwinds of FY2026 to ease while core volumes and pricing recover.
| Metric | FY2026 | FY2025 | YoY |
|---|---|---|---|
| Revenue (¥ million) | 2,585,077 | 2,563,280 | +0.9% |
| Business profit (¥ million) | 141,913 | 142,762 | −0.6% |
| Operating profit (¥ million) | 97,221 | 127,453 | −23.7% |
| Pre-tax profit (¥ million) | 107,599 | 114,288 | −5.9% |
| Net profit attrib. to owners (¥ million) | 79,521 | 77,911 | +2.1% |
| Basic EPS (¥) | 52.96 | 48.93 | +8.2% |
| Business profit margin | 5.5% | 5.6% | −0.1pp |
| Total assets (¥ million) | 3,476,976 | 3,292,597 | +5.6% |
| BPS (¥) | 1,236.45 | 1,092.90 | +13.1% |
| Annual dividend (¥) | 26.00 | 18.00 | +44.4% |
| FY2027 revenue guidance (¥ million) | 2,830,000 | — | +9.5% |
| FY2027 business profit guidance (¥ million) | 160,000 | — | +12.7% |
JapanStockPulse provides informational content only and does not constitute investment advice. Figures are taken from the company's published earnings short report and may be subject to subsequent revision.