Tokyo Century (8439): FY2025 Results Summary — Record Net Income of ¥111.3 Billion, Mid-Term Target Reached Two Years Early

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Tokyo Century Corporation posted record net income attributable to owners of parent of ¥111.3 billion for FY2025 (the fiscal year ended March 31, 2026), up ¥26.0 billion year on year, with ROA at 1.6% and ROE at 10.4%. The company achieved its Medium-Term Management Plan 2027 targets (net income: ¥100.0 billion; ROA: 1.4%; ROE: 10%) ahead of schedule, meeting the net income target two years early. The result absorbed a ¥46.8 billion after-tax impairment loss on the biomass co-firing business, while insurance settlement proceeds in the aviation business added ¥65.0 billion. For FY2026 the company plans record net income of ¥123.0 billion and an annual dividend of ¥90.

Consolidated Results (Full-Year Actual)

Net income attributable to owners of parent rose from ¥85.3 billion in FY2024 to ¥111.3 billion (+30.5%). On the company’s net income bridge, base earnings power excluding non-recurring factors — defined as extraordinary income/losses and non-recurring tax expenses in the aviation business — grew ¥18.1 billion year on year, from ¥84.4 billion to ¥102.5 billion, driven by gains on the sale of U.S. data centers in International Business. The bridge items were prior-year non-recurring factors of −0.9, impairment losses on IT systems and goodwill of subsidiaries in FY2025 of −11.9, the impairment loss on the biomass co-firing business of −46.8, insurance settlement proceeds of +65.0, a reversal of tax expense in the aviation business of +2.5, and income accumulated in operating segments of +18.1 (billions of yen).

The average JPY/USD exchange rate was ¥149.62 in FY2025 against ¥151.68 in FY2024, and the fiscal year-end rate was ¥156.54 against ¥158.17. FX sensitivity on net income is stated as approximately ±¥0.4 billion per ¥1 change. Total assets and shareholders’ equity both expanded, and the shareholders’ equity ratio improved 0.5 points to 15.5%.

Item	FY2025 / Mar. 31, 2026	FY2024 / Mar. 31, 2025	Change
Net income attributable to owners of parent (billions of yen)	111.3	85.3	+26.0
Net income excl. non-recurring factors (billions of yen)	102.5	84.4	+18.1
ROE	10.4%	9.0%	+1.4 pts
ROA	1.6%	1.3%	+0.3 pts
Funding cost (billions of yen)	124.9	123.6	1.3
Interest expense (billions of yen)	11.2	9.7	1.5
Financing cost = funding cost + interest expense (billions of yen)	136.1	133.3	2.8
Financing cost ratio	2.71%	2.76%	(0.1 pts)
Total assets (billions of yen)	7,214.8	6,862.9	351.9
Segment assets (billions of yen)	6,310.7	6,059.9	250.9
Shareholders’ equity (billions of yen)	1,120.5	1,029.6	90.9
Shareholders’ equity ratio	15.5%	15.0%	0.5 pts
Interest-bearing debt (billions of yen)	5,142.5	4,912.6	229.9
Foreign currency ratio of interest-bearing debt	47.4%	45.8%	1.6 pts

Segment Results

Under the segmentation used through FY2025, Specialty Financing led the increase with net income of ¥112.2 billion (up ¥79.3 billion), reflecting insurance settlement proceeds (+65.0) and tax expense in the aviation business (+10.8). International Business rose ¥7.2 billion to ¥23.5 billion on higher gains on sales of U.S. data centers and operational investment securities, partly offset by valuation losses on investment securities. Equipment Leasing was flat at ¥22.8 billion, as higher income at NTL and other affiliates offset valuation losses on investment securities. Automobility fell ¥5.6 billion to ¥12.1 billion on impairment losses related to NCS’s IT systems (−5.2), and Environmental Infrastructure swung to (44.5) from 0.1 on the impairment loss on the biomass co-firing business (−46.8). Other was (14.9) against (4.5), mainly on the absence of gains on sales of cross-held shares recorded in the previous fiscal year (−9.1).

Within the segments, NTT TC Leasing (NTL) contributed ¥8.5 billion, up ¥1.7 billion. At Automobility, Nippon Car Solutions (NCS) declined to ¥1.6 billion from ¥7.6 billion while Nippon Rent-A-Car Service (NRS) achieved record-high income for the fourth consecutive year at ¥10.6 billion, up ¥0.8 billion. In Specialty Financing, Aviation earned ¥98.9 billion (up ¥84.8 billion), Shipping (0.2), Real Estate ¥12.4 billion and Principal Investment, etc. ¥1.1 billion. Aviation Capital Group (ACG) reported income before income taxes of $751 million versus $174 million, or $200 million versus $174 million excluding one-time income associated with the Russia insurance recovery, with segment assets of $12,565 million as of December 31, 2025 and 278 owned aircraft. CSI Leasing posted net income of $70 million (up $7 million), contract value of $2,007 million and segment assets of $3,132 million as of December 31, 2025.

Segment	FY2024 Result	FY2025 Result	YoY
Equipment Leasing	22.8	22.8	(0.0)
Automobility	17.7	12.1	(5.6)
Specialty Financing	32.9	112.2	79.3
International Business	16.3	23.5	7.2
Environmental Infrastructure	0.1	(44.5)	(44.5)
Other	(4.5)	(14.9)	(10.4)
Total	85.3	111.3	26.0

FY2026 Plan

Effective from FY2026 (the fiscal year ending March 2027), Tokyo Century has reclassified its operating segments into six business units: Domestic Business, Global Business, Social Infrastructure, Transport, Mobility and Corporate Investment. The FY2026 plan targets record-high net income of ¥123.0 billion, up ¥11.7 billion, on an assumption of USD1 = ¥150; the FY2025 results by segment shown in the plan are pro forma figures. Net income excluding non-recurring factors is projected to rise from ¥102.5 billion to ¥111.3 billion (+8.8), against the absence of prior-year one-time income/losses of −8.8 and extraordinary income/losses in the current fiscal year of +11.7. A ¥2.0 billion after-tax risk buffer is factored in for uncertainty; the company states that the direct impact of the Middle East situation is assumed to be limited at this time, while it closely monitors indirect risks from a prolonged situation such as rising interest rates and costs, lower demand and customer credit.

Segment (new)	FY2025 Result (pro forma)	FY2026 Plan	YoY
Domestic Business	23.4	25.3	1.9
Global Business	10.4	26.5	16.1
Social Infrastructure	(21.8)	18.9	40.7
Transport	96.3	35.4	(61.0)
Mobility	12.7	20.6	8.0
Corporate Investment	4.1	6.1	2.0
Other	(13.7)	(9.7)	4.0
Total	111.3	123.0	11.7

Shareholder Returns

The dividend policy is to maintain progressive dividends as the basic stance, balancing investment in future growth with stable and continuous shareholder returns to achieve sustainable enhancement of shareholder value, and to target a payout ratio of 35% or higher while seeking dividend growth through earnings expansion. The FY2025 plan is 80 yen per share (payout ratio: 35.1%), up ¥8 from the revised plan of 72 yen. The FY2026 plan is 90 yen (payout ratio: 35.8%), up ¥10 year on year, marking the 4th consecutive year of dividend increases.

Item	FY2025	FY2026 Plan
Full-year dividend per share	¥80.00	¥90.00
Dividend payout ratio	35.1%	35.8%

Topics

The company describes FY2025 as a year of accelerated growth investments and asset recycling to expand future earnings power. In the U.S. data center business it expanded strategic collaboration with the NTT Group and Mitsubishi Estate: a 30% stake in the Chicago project held by a Tokyo Century subsidiary was transferred to JICT in a release dated January 20, 2026, leaving an equity stake of 50% as of the end of FY2025, and the first joint data center project with Mitsubishi Estate and TA Realty — the NOVA Business Park development in Northern Virginia — saw two buildings completed in September 2025 and sold to a third-party investor in December 2025. In mobility, Tokyo Century acquired 100% of the shares of Bargain Car Rentals Australia Pty Ltd, a Tasmania-headquartered independent operator with 14 branches and approximately 5,000 vehicles, as its first stand-alone investment in an overseas car rental company. In shipping it converted CTM Ltd., a core company of the Monaco-based CTM Group and a top-tier dry bulk vessel pool operator, into an equity-method affiliate, and in corporate investment it raised its stake in Advantage Partners Pte. Ltd. (AP) to 33.3% on a fully diluted basis, making AP an equity-method affiliate.

In the aviation business, ACG has reached settlement agreements with all of its war risk insurers that were party to the litigation in California, with total insurance settlement proceeds related to its exposure to Russian airlines of $551 million, up $153 million from the $398 million announced on May 7, 2025. ACG also placed an additional order for 50 Boeing aircraft in January 2026, with delivery scheduled for 2032–2033. In Environmental Infrastructure, the company reviewed future business plans for the biomass co-firing power generation business and recorded a ¥46.8 billion after-tax extraordinary loss after concluding that initial profit targets were no longer deemed attainable. It is also developing grid-scale energy storage in Japan, targeting approximately 600 MW of operating and committed projects.

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.