Komori
Financial results presentation3708Tokushu Tokai Paper Co.,Ltd.Materials and Chemicals

Notice Regarding the Formulation of the 7th Medium-Term Management Plan

The Company formulated its Seventh Medium-Term Management Plan covering the fiscal years ending March 2027 through March 2029, setting out a policy of pursuing growth investments centered on the resource recycling business while stabilizing existing businesses. The plan sets targets of ¥8.0 billion in ordinary profit and ROE of at least 7.0% for the fiscal year ending March 2029, and strengthens the shareholder return policy.

Worth reading
66In focus
0–100. This measures how worthwhile something is to read, not how good or bad the company is.
Direction
Improvement
Direction inferred from the company’s description.
Scale
23
¥100 million (target increase in ordinary profit from the fiscal year ending March 2026 results to the fiscal year ending March 2029 target)
Wording
Conditional
How definitive the wording is.

Contents of this document

Medium-Term Management Plan PresentationFiscal year ending March 2026 results and the Seventh Medium-Term Management Plan for the fiscal years ending March 2027 through March 202913 items taken from the company’s own explanation
Financial Results Figures (The key points of this material are explained below)
Operating profit¥4,296 million
Ordinary income¥5,728 million
Net income¥4,368 million
Full-year earnings forecast
Ordinary income
Fiscal year ending March 2027 forecast¥5,800 million
What the company explained in this material
Self-assessment against the planThe company's self-assessment against its own plan.
The target for the final year of the Sixth Medium-Term Management Plan was not achieved. Some initiatives were completed as planned, while others fell short.
Breakdown of Factors Affecting the ChangeReasons cited by the Company for the change in the figures.
  • Volume and price+¥4.8 billion
  • Materials-¥1.9 billion
  • Plant efficiency-¥100 million
  • Fixed costs, etc.-¥1.0 billion
  • Environmental Matters+¥700 million
  • Other+¥200 million
Assumptions Underlying the Business OutlookThe assumptions used by the company in preparing its forecast.
  • ¥2.5–3.0 trillion
    AssumptionsElectrical materials market size
    RemarksProjected to grow at a 5% CAGR over the medium to long term
  • 2,000 tonnes/month
    AssumptionsRPF production capacity
    RemarksFull production on a three-shift, year-round basis from 2027
New initiatives
  • Entry into multiple new businesses in the resource recycling field
  • Expansion of RPF production at the new plant and establishment of a production system with capacity of 2,000 tonnes/month
  • Consideration of collaboration in the containerboard business
  • Expansion of sales of aramid paper and establishment of a system for increased production
  • Establishment of a development division specializing in specialty paper
  • Absorption-type merger of 株式会社TTトレーディング
  • Establishment of a DX Promotion Division
  • Introduction of an employee stock ownership plan (ESOP)
  • Introduction of a restricted stock compensation plan (RS) for directors, executive officers and others
  • New dividend policy providing the higher of a 50% dividend payout ratio or 4.0% DOE
Key KPIsA metric the company considers important as a management benchmark.
  • ROE5.4% (fiscal year ending March 2026 results), at least 7.0% (fiscal year ending March 2029 target)
  • PBR0.67x (fiscal year ending March 2026 results)
  • PER12.87x (fiscal year ending March 2026 results)
  • One-on-one IR meetings with analysts and institutional investors31 meetings (fiscal year ending March 2026 results)
Segment results
  • Industrial materials
    FY2026 profit¥2,013 million
    Target for the fiscal year ending March 2029¥3,100 million
    Change Rate+54.0%
  • Specialty materials
    FY2026 profit¥1,494 million
    Target for the fiscal year ending March 2029¥1,700 million
    Change Rate+13.8%
  • Consumer products
    FY2026 profit¥798 million
    Target for the fiscal year ending March 2029¥900 million
    Change Rate+12.8%
  • Environmental Matters
    FY2026 profit¥755 million
    Target for the fiscal year ending March 2029¥1,700 million
    Change Rate+125.2%
Medium-term management plan targets
  • Ordinary income
    Actual results for the fiscal year ending March 2026¥5.7 billion
    Target for the fiscal year ending March 2029¥8 billion
  • ROE
    Actual results for the fiscal year ending March 20265.4%
    Target for the fiscal year ending March 20297.0% or more
Financial targets
  • ROE
    Actual results5.4%
    TargetAt least 7.0% (fiscal year ending March 2029), at least 9.0% (long-term target)
  • Equity ratio
    Actual results58.9%
    TargetAlso considering reducing it to around 50% during the Seventh Medium-Term Management Plan period
Market Size / Share
Electrical materials market: ¥2.5–3.0 trillion
Growth rate5% CAGR (medium- to long-term forecast)
Capital expenditures
470 At least ¥100 million investment plan including growth investment and strengthening of the business foundation
Annual Dividend
Fiscal year ending March 2026
¥53.67
Payout ratio
The higher of a 50% dividend payout ratio or a 4.0% DOE
DOE4.0%
Acquisition of treasury shares
The policy is to conduct share buybacks flexibly, but the amount, number of shares and period of the acquisition program are not disclosed
Contents of this document
ItemDetails
Document typeMedium-Term Management Plan Presentation
Fiscal Period CoveredFiscal year ending March 2026 results and the Seventh Medium-Term Management Plan for the fiscal years ending March 2027 through March 2029
Operating profit¥4,296 million
Ordinary income¥5,728 million
Net income¥4,368 million
Full-year earnings forecastOrdinary income ¥5,800 million / Annual Dividend Not disclosed
Self-assessment against the planThe target for the final year of the Sixth Medium-Term Management Plan was not achieved. Some initiatives were completed as planned, while others fell short.
Segment resultsSegment Industrial materials / FY2026 profit ¥2,013 million / Target for the fiscal year ending March 2029 ¥3,100 million / Change Rate +54.0%, Segment Specialty materials / FY2026 profit ¥1,494 million / Target for the fiscal year ending March 2029 ¥1,700 million / Change Rate +13.8%, Segment Consumer products / FY2026 profit ¥798 million / Target for the fiscal year ending March 2029 ¥900 million / Change Rate +12.8%, Segment Environmental Matters / FY2026 profit ¥755 million / Target for the fiscal year ending March 2029 ¥1,700 million / Change Rate +125.2%
Breakdown of Factors Affecting the ChangeFactors Volume and price / Amount +¥4.8 billion, Factors Materials / Amount -¥1.9 billion, Factors Plant efficiency / Amount -¥100 million, Factors Fixed costs, etc. / Amount -¥1.0 billion, Factors Environmental Matters / Amount +¥700 million, Factors Other / Amount +¥200 million
Key KPIsIndicator ROE / Value 5.4% (fiscal year ending March 2026 results), at least 7.0% (fiscal year ending March 2029 target) / Year on year against the same period last year Not disclosed, Indicator PBR / Value 0.67x (fiscal year ending March 2026 results) / Year on year against the same period last year Not disclosed, Indicator PER / Value 12.87x (fiscal year ending March 2026 results) / Year on year against the same period last year Not disclosed, Indicator One-on-one IR meetings with analysts and institutional investors / Value 31 meetings (fiscal year ending March 2026 results) / Year on year against the same period last year Not disclosed
Assumptions Underlying the Business OutlookAssumptions Electrical materials market size / Value ¥2.5–3.0 trillion / Remarks Projected to grow at a 5% CAGR over the medium to long term, Assumptions RPF production capacity / Value 2,000 tonnes/month / Remarks Full production on a three-shift, year-round basis from 2027
Medium-term management plan targetsIndicator Ordinary income / Actual results for the fiscal year ending March 2026 ¥5.7 billion / Target for the fiscal year ending March 2029 ¥8 billion, Indicator ROE / Actual results for the fiscal year ending March 2026 5.4% / Target for the fiscal year ending March 2029 7.0% or more
Financial targetsIndicator ROE / Actual results 5.4% / Target At least 7.0% (fiscal year ending March 2029), at least 9.0% (long-term target), Indicator Equity ratio / Actual results 58.9% / Target Also considering reducing it to around 50% during the Seventh Medium-Term Management Plan period
Annual DividendFiscal year ending March 2026 ¥53.67 / Interim and Year-End Breakdown Not disclosed
Payout ratioThe higher of a 50% dividend payout ratio or a 4.0% DOE
Acquisition of treasury sharesThe policy is to conduct share buybacks flexibly, but the amount, number of shares and period of the acquisition program are not disclosed
Capital expenditures470 At least ¥100 million (investment plan including growth investment and strengthening of the business foundation)
Market Size / ShareMarket Size Electrical materials market: ¥2.5–3.0 trillion / Growth rate 5% CAGR (medium- to long-term forecast)
New initiativesEntry into multiple new businesses in the resource recycling field, Expansion of RPF production at the new plant and establishment of a production system with capacity of 2,000 tonnes/month, Consideration of collaboration in the containerboard business, Expansion of sales of aramid paper and establishment of a system for increased production, Establishment of a development division specializing in specialty paper, Absorption-type merger of 株式会社TTトレーディング, Establishment of a DX Promotion Division, Introduction of an employee stock ownership plan (ESOP), Introduction of a restricted stock compensation plan (RS) for directors, executive officers and others, New dividend policy providing the higher of a 50% dividend payout ratio or 4.0% DOE
Items this document does not state (12)
Net SalesGross Profit MarginOperating profit marginSelling, general and administrative expensesResults for the three months of the current quarterProgress against full-year forecastUnit price and quantity metricsNumber of stores and locationsNumber of employeesRisk amount incorporated into the outlookOrders received and order backlogKey points of the Q&A

These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.

The reasons the company gives

The company's own explanation, not something inferred from the numbers.

To lay the groundwork for achieving a level of profitability exceeding the cost of shareholders’ equity, based on progress through the Sixth Medium-Term Management Plan and the issues to be addressed to improve the PBR. The policy is to stabilize existing businesses while entering new fields and businesses, mainly in resource recycling, to secure medium- to long-term sources of earnings.

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Notice Regarding the Formulation of the 7th Medium-Term Management Plan | Tokushu Tokai Paper Co.,Ltd. (3708) timely disclosure | Komori