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Financial results presentation5411JFE Holdings,Inc.Iron & Steel, Nonferrous Metals

Investor Meeting Materials for the First Quarter of the Fiscal Year Ending March 2027

In the first quarter of fiscal 2026, revenue increased by ¥45.8 billion year on year, while business profit rose by ¥16.1 billion to ¥32.3 billion and profit for the period increased by ¥24.1 billion to ¥31.2 billion. However, business profit excluding inventory valuation differences and other items decreased by ¥30.9 billion year on year. The apparent increase in profit includes inventory valuation differences and gains on land sales.

Worth reading
85Important
0–100. This measures how worthwhile something is to read, not how good or bad the company is.
Direction
Mixed performance
Direction inferred from the company’s description.
Scale
161
¥100 million (year-on-year increase in business profit)
Wording
Conditional
How definitive the wording is.

Contents of this document

Financial results presentationFirst quarter of the fiscal year ending March 202712 items taken from the company’s own explanation
Financial Results Figures (The key points of this material are explained below)
Net Sales11,611 Hundreds of millions of yen
Ordinary income¥409 100 million profit before tax
Net income¥312 100 million profit for the year
Results for the three months of the current quarter
Revenue¥1,161.1 billion
Business profit¥32.3 billion
Segment profit¥25.9 billion
Income before taxes¥40.9 billion
Profit for the period¥31.2 billion
Full-year earnings forecast
Revenue
48,500 Hundreds of millions of yen
Business profit
2,150 Hundreds of millions of yen
Segment profit
1,750 Hundreds of millions of yen
Income before taxes
1,900 Hundreds of millions of yen
Profit for the period
1,500 Hundreds of millions of yen
Annual Dividend
¥80 per share
ROE
6 Approximately %
What the company explained in this material
Breakdown of Factors Affecting the ChangeReasons cited by the Company for the change in the figures.
  • Steel business segment profit (year on year)+¥7.0 billion
    FactorsCosts
  • Steel business segment profit (year on year)±¥0 billion
    FactorsVolume and composition
  • Steel business segment profit (year on year)-¥45.0 billion
    FactorsSpread
  • Steel business segment profit (year on year)+¥47 billion
    FactorsInventory valuation differences and other items
  • Steel business segment profit (year on year)+¥6.1 billion
    FactorsOther
  • Steel business segment profit (year on year)approximately -¥15.0 billion
    FactorsCost impact of the situation in the Middle East
Assumptions Underlying the Business OutlookThe assumptions used by the company in preparing its forecast.
  • Exchange rate160 yen/USD, approximately
  • WTI crude oil price$80 /bbl assumption from July onward
  • Iron ore price90 US$/DMT, approximately
  • Coking coal price230 US$/WMT, approximately
  • Standalone crude steel production2,150 10,000 tonnes, approximately
New initiatives
  • Execution of a land transfer agreement for the Keihin Advanced Logistics Zone (expected gain on transfer of approximately ¥45.0 billion)
  • JFE Engineering's acquisition of all shares of Toko Kankyo and Saifuko and entry into the final disposal site business
  • Decision to construct Akita Prefecture's largest managed landfill (operations scheduled to begin in fiscal 2030; capacity of 3.16 million m³)
  • Phase 2 expansion of Kurashiki electrical steel sheet production and increased sales of heavy plates for offshore wind power
  • Initiatives to implement an additional sales price increase (+¥5,000/tonne)
Key KPIsA metric the company considers important as a management benchmark.
  • Standalone crude steel production525 10,000 tonnes
    Year on year against the same period last year-30,000 tonnes
  • Standalone steel shipments454 10,000 tonnes
    Year on year against the same period last year-170,000 tonnes
  • Average steel price¥124.2 thousand/t
    Year on year against the same period last year+¥3,800/tonne
  • High-value-added product ratio (fiscal 2025 actual)53 %
    Year on year against the same period last year+5 percentage points
  • JFE Engineering order intake1,776 Hundreds of millions of yen
    Year on year against the same period last year+¥58.4 billion
  • Debt/EBITDA multiple (outlook for the first half of fiscal 2026)4.8 times
Unit price and quantity metricsThese figures show sales broken down by price and volume.
  • Standalone crude steel production525 10,000 tonnes
  • Standalone steel shipments454 10,000 tonnes
  • Average steel price¥124.2 thousand/t
Segment results
  • Steel business
    Revenue7,635 Hundreds of millions of yen
    Segment profit30 Hundreds of millions of yen
  • Engineering Business
    Revenue1,473 Hundreds of millions of yen
    Segment profit89 Hundreds of millions of yen
  • Trading Business
    Revenue3,806 Hundreds of millions of yen
    Segment profit113 Hundreds of millions of yen
  • Adjustments
    Revenue-1,304 Hundreds of millions of yen
    Segment profit26 Hundreds of millions of yen
Medium-term management plan targets
  • PlanEighth Medium-Term Management Plan
    Target fiscal yearFY2027
    Business profit¥400 billion
    ROEAt least 10%
    Annual Dividendpayout ratio of approximately 30%, with a floor of ¥80/share
  • PlanJFE Vision 2035
    Target fiscal yearFY2035
    Segment profit¥700 billion
Financial targets
  • ROE
    TargetFiscal 2027: at least 10%
    Actuals and outlookFiscal 2026: approximately 6%
  • Debt/EBITDA multiple
    TargetFiscal 2027: approximately 3 times
    Actuals and outlookOutlook for the first half of fiscal 2026: 4.8 times; approximately 4 times at fiscal year-end
  • D/E ratio
    TargetFiscal 2027: approximately 60%
    Actuals and outlookOutlook for the first half of fiscal 2026: 66.6%
Risk amount incorporated into the outlookThe amount representing the range of variation the company expects in its forecast.
¥600 100 million/year, approximately
DetailsCost impact of the situation in the Middle East on raw materials, fuel, energy, logistics, materials and other items, including group companies
Orders received and order backlog
JFE Engineering
Orders received
¥1,776 100 million first quarter
Order backlog
¥12,235 100 million FY2025 actual
Annual Dividend
Annual¥80 per share
Interim¥40 per share
End of period¥40 per share
Payout ratio
30 Approximately %
Contents of this document
ItemDetails
Document typeFinancial results presentation
Fiscal Period CoveredFirst quarter of the fiscal year ending March 2027
Net Sales11,611 Hundreds of millions of yen
Ordinary income¥409 100 million (profit before tax)
Net income¥312 100 million (profit for the year)
Results for the three months of the current quarterRevenue ¥1,161.1 billion / Business profit ¥32.3 billion / Segment profit ¥25.9 billion / Income before taxes ¥40.9 billion / Profit for the period ¥31.2 billion
Full-year earnings forecastRevenue 48,500 Hundreds of millions of yen / Business profit 2,150 Hundreds of millions of yen / Segment profit 1,750 Hundreds of millions of yen / Income before taxes 1,900 Hundreds of millions of yen / Profit for the period 1,500 Hundreds of millions of yen / Annual Dividend ¥80 per share / ROE 6 Approximately %
Segment resultsSegment Steel business / Revenue 7,635 Hundreds of millions of yen / Segment profit 30 Hundreds of millions of yen, Segment Engineering Business / Revenue 1,473 Hundreds of millions of yen / Segment profit 89 Hundreds of millions of yen, Segment Trading Business / Revenue 3,806 Hundreds of millions of yen / Segment profit 113 Hundreds of millions of yen, Segment Adjustments / Revenue -1,304 Hundreds of millions of yen / Segment profit 26 Hundreds of millions of yen
Breakdown of Factors Affecting the ChangeSubject Steel business segment profit (year on year) / Factors Costs / Amount +¥7.0 billion, Subject Steel business segment profit (year on year) / Factors Volume and composition / Amount ±¥0 billion, Subject Steel business segment profit (year on year) / Factors Spread / Amount -¥45.0 billion, Subject Steel business segment profit (year on year) / Factors Inventory valuation differences and other items / Amount +¥47 billion, Subject Steel business segment profit (year on year) / Factors Other / Amount +¥6.1 billion, Subject Steel business segment profit (year on year) / Factors Cost impact of the situation in the Middle East / Amount approximately -¥15.0 billion
Key KPIs525 10,000 tonnes, 454 10,000 tonnes, ¥124.2 thousand/t, 53 %, 1,776 Hundreds of millions of yen, 4.8 times
Unit price and quantity metrics525 10,000 tonnes, 454 10,000 tonnes, ¥124.2 thousand/t
Assumptions Underlying the Business OutlookExchange rate 160 yen/USD, approximately, WTI crude oil price $80 /bbl (assumption from July onward), Iron ore price 90 US$/DMT, approximately, Coking coal price 230 US$/WMT, approximately, Standalone crude steel production 2,150 10,000 tonnes, approximately
Risk amount incorporated into the outlook¥600 100 million/year, approximately
Medium-term management plan targetsPlan Eighth Medium-Term Management Plan / Target fiscal year FY2027 / Business profit ¥400 billion / ROE At least 10% / Annual Dividend payout ratio of approximately 30%, with a floor of ¥80/share, Plan JFE Vision 2035 / Target fiscal year FY2035 / Segment profit ¥700 billion
Financial targetsIndicator ROE / Target Fiscal 2027: at least 10% / Actuals and outlook Fiscal 2026: approximately 6%, Indicator Debt/EBITDA multiple / Target Fiscal 2027: approximately 3 times / Actuals and outlook Outlook for the first half of fiscal 2026: 4.8 times; approximately 4 times at fiscal year-end, Indicator D/E ratio / Target Fiscal 2027: approximately 60% / Actuals and outlook Outlook for the first half of fiscal 2026: 66.6%
Annual DividendAnnual ¥80 per share / Interim ¥40 per share / End of period ¥40 per share
Payout ratio30 Approximately %
Orders received and order backlogJFE Engineering Orders received ¥1,776 100 million (first quarter) / Order backlog ¥12,235 100 million (FY2025 actual)
New initiativesExecution of a land transfer agreement for the Keihin Advanced Logistics Zone (expected gain on transfer of approximately ¥45.0 billion), JFE Engineering's acquisition of all shares of Toko Kankyo and Saifuko and entry into the final disposal site business, Decision to construct Akita Prefecture's largest managed landfill (operations scheduled to begin in fiscal 2030; capacity of 3.16 million m³), Phase 2 expansion of Kurashiki electrical steel sheet production and increased sales of heavy plates for offshore wind power, Initiatives to implement an additional sales price increase (+¥5,000/tonne)
Items this document does not state (12)
Operating profitGross Profit MarginOperating profit marginSelling, general and administrative expensesProgress against full-year forecastSelf-assessment against the planNumber of stores and locationsNumber of employeesAcquisition of treasury sharesCapital expendituresMarket Size / ShareKey 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.

The company attributed the increase in profit to improvements in inventory valuation differences, a ¥15.0 billion gain on the sale of land, and improved performance at group companies, particularly the India business. In the steel business, however, deteriorating domestic and overseas steel market conditions, higher prices for key raw materials, and cost increases stemming from the situation in the Middle East were negative factors.

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Investor Meeting Materials for the First Quarter of the Fiscal Year Ending March 2027 | JFE Holdings,Inc. (5411) timely disclosure | Komori