I flagged an event‑driven ROE improvement setup at Tokyo Century (TC) back in October 2024, and the stock has since climbed about 30%. The key catalyst was the insurance payout tied to eight aircraft that had been leased to Russia and later seized. Investors were watching closely to see whether TC would use the proceeds for new growth investments or return more capital to shareholders.

TC ultimately received $545 million (roughly ¥80 billion) in May and August 2025, which it plans to record as extraordinary income in FY3/2026.

Those eight aircraft had been written down to about ¥46 billion ($380 million) in 2022. By recovering $545 million, TC not only covered the written‑down value of the aircraft but also recouped additional amounts related to financing and loan guarantees provided to Russian airlines.

The company has since raised its financial outlook, indicating that it is hitting major performance milestones ahead of schedule. The current landscape looks like this:

1. Upgraded FY3/2026 Earnings

On November 7, 2025, with its Q2 results, TC revised its guidance:

Net Profit: Increased to ¥100 billion (from ¥93 billion).

Ahead of Plan: This ¥100 billion level was originally the FY2028 target under the Medium‑Term Plan, meaning TC is on pace to achieve it two years early.

2. Progress on Medium‑Term Targets

The five‑year plan launched in May 2023 set three main goals. Current status:

Net Profit (¥100B): Achieved, based on the updated FY2026 forecast.

PBR > 1x: Essentially achieved, with shares trading near 1x.

ROE 10%: Reported ROE is 18.1%, but this is temporarily boosted by the insurance gains. On a normalized basis, the company has not yet reached a sustainable 10%.

3. What Comes Next: Strategy Reset

With the original profit targets being met ahead of schedule, the market is now focused on how TC will recalibrate its strategy and capital allocation in the next medium‑term plan.

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