Toagosei (4045): FY2025 Results Summary — Net Income Up 7.5% on Sale of Cross-Shareholdings

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Toagosei Co., Ltd. (TSE Prime: 4045), a chemical group spanning commodity chemicals, polymers and oligomers, adhesives, performance chemicals, and plastics, announced results for FY2025 (fiscal year ended December 31, 2025). Net sales decreased and operating income slightly decreased, while ordinary profit declined due to reduced foreign currency exchange gains; net income attributable to owners of parent increased due to the sale of cross-shareholdings. The company bought back approximately 4.8 million treasury shares (approximately 7.0 billion yen), canceled 5 million shares, and declared an annual dividend of 65 yen per share (payout ratio of 55.5%), an increase of 5 yen from the previous year, bringing total shareholder returns to 110.1%.

Consolidated Results (Full-Year Actual)

For FY2025 (1-4Q), net sales were 162,312 million yen, down (3.2)% year on year, as sales volumes for commodity chemicals declined overall and the acrylic ester overseas market remained sluggish. Operating income was 14,180 million yen, down (0.4)%, with the operating income ratio improving to 8.7% from 8.5%. Ordinary profit was 15,067 million yen, down (5.8)%, and net income attributable to owners of parent rose +7.5% to 12,766 million yen. The average exchange rate was 149.59 yen/USD (150.70 in FY2024) and the average naphtha price was 67,125 yen/kl (75,400 in FY2024).

Item	1-4Q FY2024	1-4Q FY2025	Change	Rate of Change
Net sales (Millions of yen)	167,594	162,312	(5,281)	(3.2)%
Operating income (Millions of yen)	14,233	14,180	(53)	(0.4)%
Operating income ratio	8.5%	8.7%	+0.2PP	—
Ordinary profit (Millions of yen)	15,993	15,067	(925)	(5.8)%
Net income attributable to owners of parent (Millions of yen)	11,877	12,766	889	+7.5%
Net income per share (Yen)	104.56	117.02	12.46	+11.9%
Annual dividend (Yen)	60.0	65.0	5.0	+8.3%

Segment Results

By segment, Commodity Chemicals saw net sales fall to 71,772 million yen while operating income rose to 8,752 million yen (operating income ratio 12.2%). Polymer & Oligomer sales increased to 36,169 million yen but operating income declined to 3,018 million yen. Plastics posted a significant profit increase to 2,754 million yen, as the environmental & infrastructure system business achieved higher sales and sales price revisions of products to counter infrastructure aging. In Performance Chemicals, sales volume of high-purity inorganic chemicals for semiconductor applications decreased due to delayed recovery in demand other than ongoing AI-related demand.

Segment	Net sales FY2024	Net sales FY2025	Operating income FY2024	Operating income FY2025
Commodity Chemicals	79,145	71,772	8,501	8,752
Polymer & Oligomer	35,187	36,169	3,779	3,018
Adhesive Material	13,344	13,607	409	323
Performance Chemicals	10,196	10,225	1,275	1,177
Plastics	27,702	28,177	1,761	2,754
Other/adjustments	2,018	2,360	(1,493)	(1,845)
Total (Millions of yen)	167,594	162,312	14,233	14,180

FY2026 Forecast

For FY2026, Toagosei forecasts net sales of 167,000 million yen, operating income of 14,500 million yen (operating income ratio 8.7%), ordinary profit of 15,100 million yen, and net income attributable to owners of parent of 11,500 million yen. Assumptions are an average exchange rate of 150.00 yen/USD and an average naphtha price of 64,000 yen/kl. To absorb the increase in fixed costs, including labor costs and depreciation expenses, the company will focus on increasing sales volume, improving profitability, and reducing expenses.

Item	FY2025 (Actual)	FY2026 Forecast	Change
Net sales (Millions of yen)	162,312	167,000	4,688
Operating income (Millions of yen)	14,180	14,500	320
Operating income ratio	8.7%	8.7%	0.0PP
Ordinary profit (Millions of yen)	15,067	15,100	33
Net income attributable to owners of parent (Millions of yen)	12,766	11,500	(1,266)
Dividend (Yen)	65.00	70.0	5.0

By segment, Commodity Chemicals is forecast to see lower sales and profit, reflecting discontinued sales of PVC and certain monomer products as well as increased repair costs for acrylic acid. Increases are forecast for Polymer & Oligomer (higher sales volume of polymers for pharmaceuticals/cosmetics and semiconductor products), Adhesive Material (functional and mobility-related adhesives), Performance Chemicals (High-Purity Liquefied Hydrogen Chloride and High-Purity Potassium), and Plastics (sewer-infrastructure rehabilitation products).

Segment	Net sales FY2026 Forecast	Change	Operating income FY2026 Forecast	Change
Commodity Chemicals	68,000	(3,772)	7,100	(1,652)
Polymer & Oligomer	40,200	4,031	3,800	782
Adhesive Material	14,900	1,293	600	277
Performance Chemicals	11,600	1,375	1,500	323
Plastics	29,300	1,123	3,300	546
Other/adjustments	3,000	640	(1,800)	45
Total (Millions of yen)	167,000	4,688	14,500	320

Shareholder Returns

For FY2025, Toagosei declared a year-end dividend of 32.5 yen per share, bringing the annual dividend to 65 yen per share (payout ratio of 55.5%), an increase of 5 yen from the previous year. The company bought back approximately 4.8 million treasury shares (approximately 7.0 billion yen) and canceled 5 million shares; total shareholder returns were 110.1%. For FY2026, the dividend forecast is 70.0 yen per share (35.0 yen for each half). During the period of the new medium-term management plan, the company aims to achieve total shareholder returns of approximately 90% and a dividend payout ratio of approximately 70%, and will continue to promote management aimed at achieving a P/B ratio of over 1x.

Topics

Toagosei will continue selling cross-held shares to improve capital efficiency, targeting a ratio of less than 10% of net assets; as of December 31, 2025, the ratio of cross shareholdings to net assets was 14.3% (shareholding balance: 30,892 million yen), with a total sale value of 23,626 million yen over the last five years. TOAGOSEI CHEMICAL INDIA PRIVATE LIMITED, newly established in 2025, was included in the scope of consolidation from this fiscal year, while Elmer’s & Toagosei Co. was dissolved and excluded from equity-method affiliates (21 consolidated subsidiaries and 1 equity-method affiliate).

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