TOKYO — Tokyo Gas Co., Ltd. (9531.T) unveiled its FY2026–2028 Medium-term Management Plan on Wednesday, aiming to accelerate profit growth and achieve its Compass2030 profit target ahead of schedule through disciplined capital recycling and strategic investments totaling up to ¥1.3 trillion.
The Japanese energy giant plans to generate ¥400 billion in free cash flow and return at least ¥200 billion to shareholders over the three-year period. It targets a return on equity (ROE) of 9% by FY2028, up from 8% in FY2025, supported by a progressive dividend policy and enhanced portfolio management using segment-level ROIC benchmarks.
Segment profit is projected to rise to ¥210 billion by FY2028, driven by growth in three core areas: Energy, Solutions, and Overseas. The company aims to expand LNG trading, grow its electricity customer base to 5.2 million, and monetize shale gas assets in North America while pursuing mid- and downstream integration.
The Solutions business, branded as IGNITURE, is expected to see segment profit surge from ¥5 billion in FY2025 to ¥28 billion in FY2028, with residential equipment revenue surpassing ¥100 billion and commercial energy solutions expanding domestically and abroad.
Tokyo Gas also plans to invest ¥430 billion in its Energy segment, ¥350 billion in Overseas operations, and ¥200 billion in Solutions, while allocating ¥120 billion to Urban Development. The company will implement ROIC-based portfolio management to optimize resource allocation and improve capital efficiency.
The announcement follows strong performance under the current FY2023–2025 plan, with ROE forecasted at 11.8% and cumulative operating cash flow reaching ¥1.2 trillion. Tokyo Gas shares have outperformed the Nikkei 225 and sector averages, rising 111% since FY2023.
Amid rising geopolitical risks, inflation, and Japan’s labor shortage, Tokyo Gas sees opportunities in digital expansion, AI deployment, and growing LNG demand across Asia-Pacific. The company also anticipates higher energy costs under Japan’s upcoming carbon pricing scheme (GX-ETS) launching in FY2026.