Japan: Tokyo Steel forecasts 90% decline in net profit in FY27

• FY27 net profit forecast revised to JPY 1 bn ($6.15 mn)
• July-Sep operating loss expected to narrow sequentially

Tokyo Steel revised its standalone earnings forecast for the fiscal year ending March 2027 on the 17th, projecting net profit of JPY 1 billion ($6.15 million), down 91.3% from the previous fiscal year, compared with its earlier forecast of zero profit. The revision reflects gains from investment securities and land sales, while other forecast items remained unchanged. The company’s second-half forecast remains as initially projected.

For the April-September 2026 period, Tokyo Steel expects net sales of JPY 155 billion ($953.7 million), up 15.8% y-o-y. Operating loss is forecast at JPY 4 billion ($24.61 million) , compared with an operating profit of JPY 6.045 billion ($37.48 million) in the same period last year. Ordinary loss is projected at JPY 3 billion ( $18.46 million), against a profit of JPY 6.983 billion ($43.3 million) previously, while net profit is expected at JPY 1 billion ($6.15 million), down 78.1% year-on-year.

Steel product sales volume for July-September is expected at 761,000 tonnes (t), up 22,000 t from April-June. The product unit price is forecast at JPY 104,000/t ($640/t), up JPY 7,200/t ($44/t), while steel scrap costs are expected at JPY 55,700/t ($343/t), up JPY 500/t ($3/t). The metal spread is projected at JPY 48,300/t ($297/t), an increase of JPY 6,700/t ($41/t).

Total steel product sales volume for the first half is expected at 1.5 million tonnes (mnt), down 30,000 t from the initial forecast. Operating loss for July-September is forecast at JPY 1.7 billion ($10.47 million), an improvement of JPY 600 million ($3.69 million) from the April-June quarter.

Losses of JPY 2.43 billion ($15.07 million), JPY 2 billion ($ 12.31 million) in losses received and JPY 68 million ($0.418 million) in quantities contributed to the decline in profit. However, improved spreads resulting from widespread price increases are expected to increase profits by JPY 5.098 billion ($31.60 million).