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Presentation materials for financial results7013IHI CorporationMachinery

Presentation Materials for Investor Day

IHI positioned FY2026-FY2028 as a period for upfront investment and strengthening its financial base, and outlined plans to invest in growth businesses such as commercial engines, defense and nuclear power, while expanding production capacity and LCB. It also specified medium- to long-term targets from FY2028 onward for operating profit, operating cash flow, ROIC and shareholder returns.

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75Important
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Improvement
Direction inferred from the company’s description.
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Wording
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Contents of this document

Medium-Term Management Plan Presentation8 items taken from the company’s own explanation
Financial Results Figures (The key points of this material are explained below)
Operating profit margin
RatePhase 1: 10-13%; Phase 2: 13% or more; Phase 3: 15% or more
What the company explained in this material
Breakdown of Factors Affecting the ChangeReasons cited by the Company for the change in the figures.
  • Engine aftermarketCompared with FY2025, operating profit is expected to increase by ¥50-60 billion in Phase 1 and by ¥150-160 billion in Phase 2
  • Defense
  • LCB expansion
  • Nuclear power, space and ammoniaListed as a driver of operating profit growth in Phase 2; amount: 非開示
Assumptions Underlying the Business OutlookThe assumptions used by the company in preparing its forecast.
  • Exchange rateUS$1 = ¥145
  • Defense spendingEquivalent to 2% of GDP
  • HEV turbocharging and internal-combustion vehicle marketMarket size outlook shown in a chart; some specific figures: 非開示
New initiatives
  • Development of composite materials for aircraft engines and establishment of a domestic production base
  • More than doubling nuclear equipment production capacity
  • Expansion of the production area at the Yokohama Plant and development of the Aioi Plant as a production center
  • Expansion of the maintenance building at the Tsurugashima Plant and construction of new training and repair buildings
  • Establishment of a new parts repair facility in the United States
  • Expansion of the solid rocket motor and UUV businesses
  • Long-term partnerships for the bridge business in North America and Europe
Key KPIsA metric the company considers important as a management benchmark.
  • ROICFY2025: 11.0%; Phase 1 average: 11%; Phase 2 average: 11% or more; FY2035 indicative target: 13% or more
  • Operating cash flowCumulative FY2023-FY2025: ¥361.1 billion; cumulative Phase 1: ¥350 billion; cumulative Phase 2: ¥750 billion
  • Revenue CAGRFY2025-FY2035: 5% or more
Medium-term management plan targets
  • Operating margin
    Target fiscal yearFY2028、FY2031、FY2035
    Target value10-13%, 13% or more, 15% or more
  • Cumulative operating cash flow
    Target fiscal yearFY2028、FY2031、FY2035
    Target value¥350 billion, ¥700 billion or more, ¥1 trillion or more
  • Cumulative investment
    Target fiscal yearFY2028
    Target value¥650 billion
  • ROIC
    Target fiscal yearFY2035
    Target value13% or more
Financial targets
  • D/E ratio
    Target value0.5x or less
    Actual value0.72x at the end of FY2025
  • Equity ratio
    Target value35% or more
    Actual value26.9% at the end of FY2025
  • ROIC
    Target value13% or more
    Actual value11.0% at the end of FY2025
Market Size / Share
  • Bridge infrastructure marketApproximately ¥200 trillion per year; CAGR of 4% from 2030 to 2040
  • Domestic nuclear power supply2.5x the 2024 level by 2040
  • Overseas nuclear power capacity1.7x the 2023 level by 2040; more than 400 GW of new capacity required
  • Domestic share of the parking businessLeading market share
Capital expenditures
¥6,500 100 million cumulative investment for FY2026-FY2028, including R&D expenses
Contents of this document
ItemDetails
Document typeMedium-Term Management Plan Presentation
Operating profit marginRate Phase 1: 10-13%; Phase 2: 13% or more; Phase 3: 15% or more / Year-on-year change (points) Not disclosed
Breakdown of Factors Affecting the ChangeFactors Engine aftermarket / Amount Compared with FY2025, operating profit is expected to increase by ¥50-60 billion in Phase 1 and by ¥150-160 billion in Phase 2, Factors Defense / Amount Not disclosed, Factors LCB expansion / Amount Not disclosed, Factors Nuclear power, space and ammonia / Amount Listed as a driver of operating profit growth in Phase 2; amount: Not disclosed
Key KPIsIndicator ROIC / Value FY2025: 11.0%; Phase 1 average: 11%; Phase 2 average: 11% or more; FY2035 indicative target: 13% or more / Year on year against the same period last year Not disclosed, Indicator Operating cash flow / Value Cumulative FY2023-FY2025: ¥361.1 billion; cumulative Phase 1: ¥350 billion; cumulative Phase 2: ¥750 billion / Year on year against the same period last year Not disclosed, Indicator Revenue CAGR / Value FY2025-FY2035: 5% or more / Year on year against the same period last year Not disclosed
Assumptions Underlying the Business OutlookItem Exchange rate / Value US$1 = ¥145, Item Defense spending / Value Equivalent to 2% of GDP, Item HEV turbocharging and internal-combustion vehicle market / Value Market size outlook shown in a chart; some specific figures: Not disclosed
Medium-term management plan targetsItem Operating margin / Target fiscal year FY2028、FY2031、FY2035 / Target value 10-13%, 13% or more, 15% or more, Item Cumulative operating cash flow / Target fiscal year FY2028、FY2031、FY2035 / Target value ¥350 billion, ¥700 billion or more, ¥1 trillion or more, Item Cumulative investment / Target fiscal year FY2028 / Target value ¥650 billion, Item ROIC / Target fiscal year FY2035 / Target value 13% or more
Financial targetsIndicator D/E ratio / Target value 0.5x or less / Actual value 0.72x at the end of FY2025, Indicator Equity ratio / Target value 35% or more / Actual value 26.9% at the end of FY2025, Indicator ROIC / Target value 13% or more / Actual value 11.0% at the end of FY2025
Capital expenditures¥6,500 100 million (cumulative investment for FY2026-FY2028, including R&D expenses)
Market Size / ShareItem Bridge infrastructure market / Value Approximately ¥200 trillion per year; CAGR of 4% from 2030 to 2040, Item Domestic nuclear power supply / Value 2.5x the 2024 level by 2040, Item Overseas nuclear power capacity / Value 1.7x the 2023 level by 2040; more than 400 GW of new capacity required, Item Domestic share of the parking business / Value Leading market share
New initiativesDevelopment of composite materials for aircraft engines and establishment of a domestic production base, More than doubling nuclear equipment production capacity, Expansion of the production area at the Yokohama Plant and development of the Aioi Plant as a production center, Expansion of the maintenance building at the Tsurugashima Plant and construction of new training and repair buildings, Establishment of a new parts repair facility in the United States, Expansion of the solid rocket motor and UUV businesses, Long-term partnerships for the bridge business in North America and Europe
Items this document does not state (21)
Fiscal Period CoveredNet SalesOperating profitOrdinary incomeNet incomeGross Profit MarginSelling, general and administrative expensesResults for the three months of the current quarterFull-year earnings forecastProgress against full-year forecastSelf-assessment against the planSegment resultsUnit price and quantity metricsNumber of stores and locationsNumber of employeesRisk amount incorporated into the outlookAnnual DividendPayout ratioAcquisition of treasury sharesOrders 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 strengthen technologies that competitors cannot replicate, expand production capacity through investment in growth businesses, and expand LCB in stable-earnings businesses. In nuclear power, IHI identified the restart and reprocessing of nuclear facilities in Japan and overseas demand for new facilities as growth opportunities. In commercial engines, it cited second-generation engines and the aftermarket, while in defense it cited the expansion of defense spending.

How to read this page

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Corrections happenIf the company reissues this disclosure, the page is rebuilt from the corrected version and the revision number moves up.
Presentation Materials for Investor Day | IHI Corporation (7013) timely disclosure | Komori