Aichi Steel net profit increases to Y11.25 billion for fiscal year 2026

Q: Why did selling billions in Toyota shares have zero impact on Aichi Steel's reported profit?

It had no effect on Aichi Steel’s reported **consolidated profit** because, under IFRS, the Toyota-group stake was likely treated as an equity investment measured at **fair value through other comprehensive income (FVOCI)**, not through profit and loss. That accounting treatment is crucial. For FVOCI equity holdings, unrealized gains and losses are recorded in **other comprehensive income**, not in the income statement. When the shares are later sold, the cumulative gain is **not recycled into profit**. Instead, it stays within equity, typically moving within reserves or retained earnings. So even a multibillion-yen disposal can produce **zero impact on profit for the period**. That matches Aichi Steel’s own disclosure around the sale of its Toyota Industries shares. The company said the transaction would generate a large gain in its **non-consolidated** accounts under Japanese accounting, but would have **no impact on consolidated profit** under IFRS. In other words, the gain existed economically and in parent-only reporting, but IFRS consolidated reporting kept it out of net profit. The broader context also fits. Japanese companies have been unwinding cross-shareholdings under governance reforms, and these strategic stakes are often designated under IFRS in a way that avoids volatility in earnings. So the sale did not mean the gain vanished; it meant the gain was recognized **outside the profit-and-loss line**.

3 articles · Updated · MarketWatch · Apr 28

The company’s revenue rose to Y304.34 billion, with operating profit at Y17.37 billion and pretax profit at Y18.49 billion for the year ended March 31.
Earnings per share climbed to Y170.63, up from Y99.50 the previous year, reflecting improved profitability under IFRS accounting standards.
Aichi Steel’s financial results indicate continued growth momentum, building on previous gains and strengthening its position in Japan’s steel industry.