Teikoku Sen-i (3302): FY2025 Results Summary — Higher Sales and Profits, Record Order Backlog as Teisen 2028 Begins

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Note: This summary is based on Teikoku Sen-i’s English-language presentation “New Medium-Term Management Plan Overview of Teisen 2028” dated February 13, 2026, which reviews FY2025 results under the previous plan (Teisen 2025) and sets out the new plan. Teikoku Sen-i Co., Ltd. (Teisen) reported higher net sales and profits in FY2025: net sales rose to 33,639 million yen and operating profit to 4,055 million yen, with the operating profit margin improving to 12.1%. Orders received increased 39.6% to 24,393 million yen and the order backlog grew 29.4% to 23,850 million yen, a record year-end level according to the company. Under the new Medium-Term Management Plan “Teisen 2028” (2026-2028), the company targets consolidated net sales of 420 (100 millions of yen) and operating profit of 58 (100 millions of yen) in 2028.

Consolidated Results (Full-Year Actual)

According to the company, despite the anticipated downturn in the nuclear power segment during a transitional period, growth in other business areas offset the decline, resulting in higher net sales and profits. In response to rising procurement costs driven by inflation, Teisen adjusted sales prices and optimized administrative expenses, improving profit margins. Against the ROE target of 8%, ROE for FY2025 was 5.4%.

Item (Millions of yen)	FY2025	FY2024	Year-on-Year
Net sales	33,639	31,481	2,158
Gross profit	9,635	8,633	1,002
Operating profit	4,055	3,459	595
Ordinary profit	5,308	4,553	754
Profit	3,742	3,253	489
Gross profit margin	28.6%	27.4%	1.2pt
Operating profit margin	12.1%	11.0%	1.1pt

Segment Results

On a non-consolidated basis, Firefighting net sales rose to 7,710 million yen, Security to 4,084 million yen and Special-purpose vehicles for airports to 3,893 million yen. Nuclear power recovered to 1,109 million yen, while Water supply and drainage and industrial complexes declined to 1,728 million yen. Textiles were 6,565 million yen.

Net Sales (Non-consolidated, Millions of yen)	FY2025	FY2024	Year-on-Year
Firefighting	7,710	6,720	990
Nuclear power	1,109	468	641
Water supply and drainage and industrial complexes	1,728	2,526	-797
Security	4,084	3,171	913
Special-purpose vehicles for airports	3,893	3,311	582
Textiles	6,565	6,440	124

Orders received remained strong, and some deliveries were pushed into later periods. As a result, the order backlog at the end of FY2025 increased by 5.4 billion yen year on year (Teikoku Sen-i on an unconsolidated basis). The company notes that, due to changes in the business portfolio and core product offerings, the year-end order backlog is now more than tenfold the level of 20 years ago.

Item (Millions of yen)	FY2025	FY2024	Year-on-Year
Orders received	24,393	17,470	+39.6%
Order backlogs	23,850	18,428	+29.4%

Under the new plan, the company is reclassifying its disaster prevention and preparedness business domain into the Water Supply and Drainage Business, Security Business, and Firefighting and Disaster Prevention Business, alongside the Textile Business.

Teisen 2028 Earnings Plan

The new Medium-Term Management Plan, Teisen 2028, represents the second phase (the mid-term stage) of the Teisen Future Creation Plan and aims to achieve an ROE level of 8% by creating revenue opportunities through strategic alliances. For 2026, the company targets consolidated net sales of 360 and operating profit of 43 (100 millions of yen). Its Vision for 2032 calls for consolidated net sales of 50 billion yen or more and ROE at the 8% level.

Indicator (100 millions of yen)	2026 Target	2028 Target	2025 Actual
Consolidated net sales	360	420	336.3
Consolidated operating profit	43	58	40.5
Consolidated ordinary profit	55	70	53.0
Profit	38	49	37.4
ROE	5.2%	6.2%	5.4%

Shareholder Returns

The total payout ratio (the shareholder return ratio including share repurchases) exceeded the benchmark of 40% throughout the previous medium-term management plan period. In FY2025, the ratio rose to 70%, driven by share repurchases totaling 1.17 billion yen. Over the three years from 2023 to 2025, shareholder returns totaled 5.5 billion yen (dividends of 3.96 billion yen and share repurchases of 1.53 billion yen, including 0.36 billion yen acquired through the stock compensation trust).

For 2026-2028, the company aims for a total payout ratio of 50% level and will make flexible decisions regarding share repurchases while considering funding needs, its share price and other conditions. The cash flow plan allocates 5 billion yen + α to shareholder returns and an investment framework of 20 billion yen (capital expenditures of 7.5 billion yen and growth investment, including M&A, of 12.5 billion yen), funded by operating cash flow of 15 billion yen and asset utilization plus financing of 10 billion yen.

Medium-Term Plan Review and Topics

In its self-assessment of Teisen 2025, the company rated the strengthening of market development as achieved, citing steady results in the water supply and drainage business and the security business. The strengthening of sustainable earning power was rated partially achieved: the final-year profit targets of 5.0 billion yen in consolidated operating profit and 6.0 billion yen in consolidated ordinary profit were not achieved, but the year-end order backlog reached a record high and will support performance from fiscal year 2026 onward. The year-end price-to-book ratio (PBR) increased to 1.17x from 0.93x at the end of the previous fiscal year.

On the environmental front, the company aims to reduce CO2 emissions by 30% by FY2030 compared with FY2021 levels; in FY2025, emissions decreased by 11.1% compared with FY2021 levels.

This article is an analysis based on publicly available information and is not a recommendation to buy or sell any specific securities. Investment decisions are your own responsibility.