Continuity and Evolution Toward Ranking among the Global Top 100 by Market Capitalization“We will build on our solid financial foundation to achieve higher ROE and next-level growth.”
I was appointed CFO in April 2026. Marubeni aspires to achieve steady growth toward global heights with the long-term objective of ranking among the global top 100 by market capitalization. As we enter year two of Mid-Term Management Strategy GC2027, which represents three years of accelerating growth toward this goal, I am committed to building on the progress the Company has made in enhancing corporate value, taking it further, and delivering on our commitments to all stakeholders through the steady execution of the strategies we have already set out.
I would like to begin by discussing how we are enhancing cash flow-oriented management as part of GC2027. Our policy is to strengthen our cash-generating capabilities by maximizing core operating cash flow and accelerating divestments. We will deploy the cash we generate with priority on high-quality growth investments to further enhance corporate value.
The Group generated cash inflows totaling ¥851.9 billion from core operating cash flow and divestments during FY2025.
Core operating cash flow totaled ¥575.1 billion in FY2025, which exceeded our projections. We are not complacent because of this success. We intend to build upon it with an even greater sense of urgency during FY2026 to achieve our target of ¥660.0 billion, which would be a record high. Divestment involves strategically selling businesses with limited scalability and low capital efficiency in terms of ROIC. We have already generated ¥276.8 billion through divestment, which is well ahead of pace against the ¥600.0 billion GC2027 target.
The cash-flow-oriented management we target is not about simply accumulating cash. In addition to accounting profit, we will pursue both growth of core operating cash flow and expansion of the ROIC-WACC spread to help the Group maximize corporate value.
During FY2026, the midpoint of GC2027, we will continue to maximize cash generation by growing core operating cash flow and accelerating divestment.
Next, I would like to discuss ROE. I consider achieving our 15% ROE target to be the most important of the various goals set out in GC2027, and I intend to focus most intently on achieving it in my role as CFO.
Our fundamental policy is to effectively allocate the cash generated to growth investments and shareholder returns, thereby achieving the dual objectives of enhancing earnings power, as represented by net profit, and optimizing capital. Through this approach to capital allocation, we aim to improve ROE.
Our goal in enhancing our earnings power is to maximize the earnings generated by the assets on our balance sheet.
The Group’s asset portfolio includes resource interests with superior cost competitiveness and an ROIC of approximately 14%, which is a high level of capital efficiency even at current commodity prices. At the same time, we see significant room to improve ROIC for our non-resource portfolio, which is at approximately 7%. We have identified Strategic Platform Businesses within our non-resource portfolio that are key to our success. They feature relatively high capital efficiency, with an average ROIC of approximately 10% across our seven core Strategic Platform Businesses. Our strategy is to concentrate capital allocation in these businesses.
During the three years of GC2027, we had planned to increase the share of Strategic Platform Businesses in our portfolio by swiftly and selectively allocating ¥1.2 trillion to these businesses, representing approximately 70% of the ¥1.7 trillion planned for growth investments. However, following the revision to our capital allocation policy announced on August 3, 2026, we increased the amount allocated for new investments, CAPEX, and other expenditures by ¥250 billion from the initial plan, bringing the total to ¥1.95 trillion. We will continue to increase the share of Strategic Platform Businesses in our portfolio by prioritizing investments expected to generate high ROIC, particularly in these businesses. In addition, we are steadily optimizing our business portfolio with a focus on capital efficiency to further enhance its quality. In FY2025, we continued to divest businesses with low capital efficiency, no clear path to growth, or profitability that had begun to peak. These businesses had an average ROIC of around 1%. Meanwhile, the Strategic Platform Businesses in which we made new investments generated an average ROIC of approximately 7%, indicating that the restructuring and strengthening of our business portfolio is progressing smoothly.
In addition, we will further improve our existing businesses and enhance overall capital efficiency by continuously raising ROIC, with the aim of increasing ROIC in our non-resource portfolio from the current level of approximately 7% to 10% or higher by FY2030.
Initiatives to optimize capital will also be crucial. S&P upgraded the Company to an A- credit rating in November 2025 as a result of our initiatives to consistently improve earnings and strengthen our financial position. This credit rating upgrade is directly benefiting our day-to-day business operations through a lower WACC resulting from reduced borrowing costs and a decrease in the implicit credit costs in transactional businesses. At the same time, the decline in our net DE ratio to 0.43 times as of March 31, 2026, has provided us with ample capacity to utilize leverage. We will optimize our capital by proactively and flexibly employing leverage within prudent limits, while remaining mindful of our credit ratings. In light of the credit rating upgrade and the increased certainty of generating the ¥200 billion in free cash projected under GC2027, we decided to allocate the ¥200 billion to shareholder returns, increasing total shareholder returns to ¥900 billion. Of this amount, ¥100 billion will be used for additional share buybacks in FY2026.
We also introduced specific performance KPIs for executive compensation beginning in FY2026 to ensure a rigorous management approach focused on capital efficiency. Metrics include ROIC for business-division Chief Operating Officers responsible for executing strategy within their respective divisions, and ROE for Executive Officers responsible for Company-wide management decision-making. We recognize that our earnings growth and management capabilities that enable us to sustain a high ROE differentiate the Marubeni Group, and we are fully committed to achieving our goals during the remainder of GC2027.
Having achieved our GC2027 target of market capitalization of over ¥10 trillion, we have set the new goal of ranking among the global top 100 by market capitalization as part of our commitment to increasing intrinsic value, although we do not have a specific timetable.
As we pursue this ambitious target, we will seek to raise market expectations for our future growth by steadily increasing earnings through growth investments and by clearly demonstrating to our stakeholders the Marubeni Group’s strong commitment to earnings growth.
We merged the Sustainability Management Department, IR & SR Department, and Corporate Communications Department into the new Stakeholder Engagement Department under the CFO (as of April 1, 2026).
We are communicating our value creation story aimed at ranking among the global top 100 by market capitalization, underpinned by a consistent core message, as we enhance dialogue with the market and disclosure and build greater trust among investors and other stakeholders.
We ask for your continued support and invite you to look forward to the Marubeni Group’s continued growth.
