Mitsui & Co., Ltd.

Core operating cash flow (COCF) increased by JPY0.5 billion year over year to JPY216.3 billion. Profit declined by JPY84.5 billion year over year to JPY191.6 billion, mainly because Q1 of the prior year included gains from asset sales. By segment, COCF included JPY71.9 billion from mineral and metal resources, JPY45.7 billion from energy, JPY36.1 billion from machinery and infrastructure, JPY32.7 billion from chemicals, and JPY12.1 billion from innovation and corporate development. Net interest-bearing debt was JPY3.4 trillion, shareholder equity was JPY7.6 trillion, and the net D/E ratio was 0.45x. Management said progress was 25% against the business plan, and noted energy and innovation/corporate development should contribute more from Q2 onward; they did not give a full-year revenue or EPS target in the call.

CFO Tetsuya Shigeta framed the quarter as solid progress against the medium-term plan, emphasizing that Mitsui is building base profit through growth investments and that several projects are already contributing. He said the company is continuing carefully selected investments in areas of expertise such as industrial business solutions, global energy transition, and wellness ecosystem creation. His tone was confident but disciplined: the plan is a stretch plan, yet management believes it is achievable and may even be exceeded if opportunities are captured.

Shigeta and Masao Kurihara highlighted that COCF was JPY216.3 billion, while profit was JPY191.6 billion, with the year-over-year drop largely driven by the absence of prior-year asset-sale gains. Kurihara broke out the main segment drivers, including weaker mineral and metal resources due to lower iron ore and metallurgical coal prices, and weaker energy profit from lower production volume despite higher gas prices. He also noted valuation gain support from ITC Antwerp, net interest-bearing debt of JPY3.4 trillion, equity of JPY7.6 trillion, and a 0.45x net D/E ratio; on capital allocation, management reiterated steady execution of growth investments and asset recycling, with no change to shareholder returns policy.

Analysts pressed management on whether Q1 strength in chemicals, LNG-related businesses, innovation and corporate development, and food could continue, and whether growth investment would become tighter as Rhodes Ridge and other commitments absorb more capital. Management said chemicals was strong, LNG-related trading and dividends were solid, innovation and corporate development benefited from JA Mitsui Leasing, and food improved on coffee trading, but the durability of those gains will depend on market conditions. On capital allocation, they said the pipeline remains rich and they are trying to preserve flexibility, including the extra JPY400 billion outflow tied to Rhodes Ridge. Analysts also asked about energy upside, tariffs, coal losses, IHH, renewables, and wind power; management said energy is ahead of plan and mainly supported by LNG projects and trading, tariff impact had not yet been significant in Q1, coal was hurt by suspended operations and fixed costs, IHH was held back by a one-time factor, and renewable energy remains challenging but still strategically important.