TPR (6463): FY2025 Results Summary — Ordinary Profit Rises on Powertrain and China Strength

This article is based on publicly available IR materials and is not a recommendation to buy or sell any specific securities.

TPR Co., Ltd. (Tokyo Stock Exchange Prime Market, Securities Code: 6463) announced its financial results for the fiscal year ended March 31, 2026 (April 1, 2025 – March 31, 2026) on May 19, 2026. In the company’s presentation materials, this period is labeled FY2025. Net sales came to 190.5 billion yen, down (1.0)% year on year, and operating profit was 10.2 billion yen, down (8.3)%, as net sales and operating profit decreased due to lower sales at the Faltec Group. Ordinary profit increased 2.4% to 16.1 billion yen due to strong performance in the powertrain business and China business, and profit attributable to owners of parent rose 6.0% to 9.3 billion yen.

Consolidated Results (Full-Year Actual)

Net sales declined by 1.9 billion yen to 190.5 billion yen and operating profit declined by 0.9 billion yen to 10.2 billion yen (operating profit ratio of 5.4%). Ordinary profit rose by 0.3 billion yen to 16.1 billion yen (ratio of 8.5%), and profit attributable to owners of parent rose by 0.5 billion yen to 9.3 billion yen (ratio of 4.9%). Average exchange rates were 150.42 yen to the US dollar (151.47 yen in the prior year) and 20.94 yen to the Chinese yuan (21.04 yen in the prior year).

Item (Billion yen)	FY2024 Full-year results	FY2025 Full-year results	YoY Amount change	YoY Percent change
Net sales	192.4	190.5	(1.9)	(1.0)%
Operating profit [profit ratio]	11.2 [5.8]	10.2 [5.4]	(0.9)	(8.3)%
Ordinary profit [profit ratio]	15.7 [8.2]	16.1 [8.5]	0.3	2.4%
Profit* [profit ratio]	8.8 [4.6]	9.3 [4.9]	0.5	6.0%

*Profit attributable to owners of parent. On the factors behind the change in ordinary profit (from 15.7 billion yen to 16.1 billion yen, an increase of 0.4 billion yen), the company explains that despite the impact of lower operating levels and wage increases at the Faltec Group, these factors were offset by cost reductions, rationalization efforts, and recovery of labor costs on a global basis. Negative factors were price reduction by customers (▲0.3), wage hike impact (▲1.0), R&D expenses (▲0.5), other (▲0.3), and Faltec Group profit/loss (▲1.2); positive factors were cost reduction and rationalization (1.5), labor cost recovery (0.5), and equity in earnings (1.7), all in billion yen. Capital participation in the China business led to an increase in equity in earnings.

Capital investment for the year was 13.91 billion yen (9.46 billion yen in the prior year), reflecting expanded capital investment in the powertrain business in response to the shift back toward engines. Depreciation was 11.80 billion yen and R&D expenses were 5.62 billion yen, with R&D expenses increasing due to upfront investment in the frontier business.

Segment Results

The company presents its results as the TPR Group (excluding the Faltec Group) — broken down into Japan, Asia, North America, and Other — plus the Faltec Group. Net sales increased in Japan (up 1.3 billion yen), Asia (up 2.0 billion yen), and North America (up 0.5 billion yen), were unchanged in Other, and decreased at the Faltec Group (down 5.9 billion yen). In operating profit, Japan declined by 1.0 billion yen while Asia and North America each improved by 0.2 billion yen, and the Faltec Group declined by 0.7 billion yen.

Segment	Metric (Billion yen)	25/3	26/3	Change
Japan	Net sales	49.3	50.7	Up 1.3 billion yen
Asia	Net sales	46.4	48.4	Up 2.0 billion yen
North America	Net sales	15.2	15.7	Up 0.5 billion yen
Other	Net sales	2.5	2.5	Unchanged
Faltec Group	Net sales	78.8	72.9	Down 5.9 billion yen
Japan	Operating profit	1.4	0.4	Down 1.0 billion yen
Asia	Operating profit	7.7	8.0	Up 0.2 billion yen
North America	Operating profit	(0.5)	(0.3)	Up 0.2 billion yen
Other	Operating profit	0.2	0.3	Unchanged
Faltec Group	Operating profit	2.1	1.4	Down 0.7 billion yen

FY2026 Forecast

For the fiscal year ending March 31, 2027 (labeled FY2026 in the materials), the company forecasts net sales of 190.9 billion yen (up 0.2%) and operating profit of 10.6 billion yen (up 3.1%), as net sales and operating profit are expected to increase slightly due to solid performance in the powertrain business. Ordinary profit is expected to decrease to 15.0 billion yen, down (7.2)%, reflecting the performance trends of equity-method affiliates, and profit attributable to owners of parent is forecast at 8.1 billion yen, down (13.8)%. The forecast assumes exchange rates of 150.00 yen to the US dollar and 20.50 yen to the Chinese yuan. The company states that the impact of the situation in the Middle East has been reflected to the extent reasonably estimable at this time.

Item (Billion yen)	FY2025 results	FY2026 full-year forecast	YoY Amount change	YoY Percent change
Net sales	190.5	190.9	0.3	0.2%
Operating profit [profit ratio]	10.2 [5.4]	10.6 [5.6]	0.3	3.1%
Ordinary profit [profit ratio]	16.1 [8.5]	15.0 [7.9]	(1.1)	(7.2)%
Profit* [profit ratio]	9.3 [4.9]	8.1 [4.2]	(1.2)	(13.8)%

*Profit attributable to owners of parent.

Shareholder Returns

In light of full-year results exceeding the earnings forecast, the annual dividend for the fiscal year ended March 2026 was increased by 6 yen to 56 yen per share (25 yen interim and 31 yen year-end). For the fiscal year ending March 2027, the company forecasts an unchanged annual dividend of 56 yen per share (28 yen interim and 28 yen year-end). The company conducted a 2-for-1 stock split of shares of common stock on October 1, 2025, and dividend amounts for prior periods are shown on a post-stock-split basis. The company targets a cumulative dividend payout ratio of over 40% during the medium-term management plan period, with stable and continuous dividend payments.

Item	24/3	25/3	26/3	27/3 (forecast)
Interim dividend (Yen)	15	25	25	28
Year-end dividend (Yen)	20	25	31	28
Annual dividend (Yen)	35	50	56	56

During the year, the company acquired treasury shares using proceeds from the sale of cross-shareholdings (2.06 million shares worth 2.5 billion yen), and it has announced a share buyback program of up to 4.5 billion yen and 4 million shares, with an estimated 4.5 billion yen of buybacks for FY2026 (versus 2.5 billion yen in FY2025). The number of cross-shareholding stocks held has been reduced from 54 at 22/3 to 48 at 26/3. The company describes its current assessment as an ROE of 5.6% and a PBR of 0.45x, and is strengthening IR activities, including more briefings for individual investors and a dedicated webpage for individual investors.

Medium-Term Plan / Topics

Under the 2026 Medium-Term Management Plan, the core policy is sustainable growth and enhancement of corporate value, with maximization of profits in the powertrain field and commercialization and business expansion in the frontier field. In the powertrain business, amid a shift back toward engines (PHEVs and HEVs) in response to the slowdown in the EV market, the company notes that its cylinder liners hold the No. 1 global market share by sales, and it plans to expand capital investment in the powertrain business to 19 billion yen (latest estimate) versus 14 billion yen assumed in the 2026 Medium-Term Management Plan. Powertrain ordinary profit for FY2025 was 14.2 billion yen.

Overseas operations are a key growth driver, with overseas ordinary profit rising from 10.4 billion yen in FY2024 to 12.5 billion yen in FY2025 (+20%). Key growth strategies include maintaining and expanding the No. 1 market share position in the China business, capital investment for markets where engine demand remains — a high-efficiency production line in India (approx. 2.0 billion yen, with a new plant also under consideration) and expansion of processing lines and plant facilities in Brazil (approx. 0.4 billion yen) — and acceleration of co-creation initiatives with partners, including manufacturing of EV-related components in Mexico for the North American market and expansion of aftermarket parts market share through entry into Mexico and expansion in Indonesia.

In the frontier business, the company has advanced the exploration of diverse business seeds and completed the identification of priority fields — mobility-related, rubber, resin and nanomaterials, and future insights — and from FY2026 onward management resources will be allocated intensively to these fields. Initiatives include xEV-related products such as large-diameter cylindrical battery cans, motor shafts, and seal rings, CNT-applied products, and a fully closed hydroponic cultivation system. The company also obtained SBTi certification for its greenhouse gas emissions reduction targets and was recognized as one of the 2026 Outstanding Organizations of KENKO Investment for Health (large enterprise category).

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.