Thank you very much for joining us today despite your busy schedule. On behalf of Toray Group, I'd like to take this opportunity to extend my gratitude towards your continued understanding and your interest in our management and business activities. Now, I'd like to report Toray's business results for the second quarter ended September 30, 2025, and the business forecast for the fiscal year ending March 2026. Now, I'd like to follow the table of contents shown on page one. This is a summary of the business performance and forecast.
The business environment of the first half continued the gradual recovery, but sluggishness in the flow of goods and holding back on purchases were also seen in some areas against the backdrop of growing uncertainties triggered by the U.S. policy shift under the Trump administration. Amid these circumstances, operating income of the first six months decreased year-on-year to JPY 67.9 billion due to the sluggish market conditions and impact from inventory adjustment, although the company worked on business structure reform and strategic pricing.
The full-year forecast for the operating income of the fiscal year ending March 2026 increased to JPY 150 billion compared with the previous fiscal year. As for the shareholders' return, in line with the resolution at the Board of Directors meeting held on November 7, 2024, Toray completed the share buybacks. The total repurchase price of shares has reached JPY 100 billion, equivalent to 103 million shares. Furthermore, the company resolved the JPY 50 billion of additional share buybacks at the Board of Directors meeting on November 14, 2025.
This resolution for repurchased shares is pursuant to this policy for the reduction of cross-shareholdings. I'll explain the details starting from the next page. I'd like to begin with a summary of business results for the second quarter ended September 30, 2025. Please turn to page four. Consolidated revenue for the first six months decreased 4.6% compared with the same period a year earlier to JPY 1,234.3 billion. Operating income decreased 14.2% to JPY 67.9 billion, and profit decreased 33.5% to JPY 36.9 billion. Page five is about assets, liabilities, equity, and free cash flow.
As for financial condition at the end of September 2025, both assets and liabilities were affected by the increase in translated yen amounts from its overseas subsidiaries due to fluctuation of the currency. Total assets stood at JPY 3,351 billion, up JPY 58.4 billion from the end of the previous fiscal year, due mainly to increases in inventories as well as property, plant, and equipment. Total liabilities increased JPY 45.3 billion from the end of the previous fiscal year to JPY 1,517.3 billion, owing mainly to increases in borrowings.
Total equity increased by JPY 13.1 billion compared with the end of the previous fiscal year to JPY 1,833.7 billion, mainly owing to increases in retained earnings and other components of equity despite the purchase of treasury shares. Owner's equity was JPY 1,716.5 billion, interest-bearing liabilities was JPY 896.2 billion, and the D/E ratio was 0.52. Free cash flow was positive at JPY 24.2 billion. Page six explains about capital expenditures, depreciation, and amortization, and R&D expenditures. Capital expenditures for the six months decreased by JPY 21.3 billion to JPY 67.1 billion on a year-to-year comparison.
Meanwhile, depreciation and amortization decreased by JPY 0.2 billion to JPY 66.2 billion. R&D expenditures increased by JPY 1 billion to JPY 36 billion compared with the same period of the previous fiscal year. Page seven shows the fact analysis of JPY 11.3 billion decrease in Core Operating income for the six months on a year-to-year comparison. The Fibers & Textiles segment was strong, mainly in apparel applications. Meanwhile, in the Performance Chemicals segment, Core Operating income decreased due to weak sales of battery separator film and lack of temporary factors, including reversal of allowance that increased profit in the first half of the previous fiscal year, etc.
In the Carbon Fiber Composite Materials segment, profit decreased due mainly to the impact of inventory adjustment. As for the net change in price, strategic pricing has proceeded steadily. Cooperating income decreased 14.2% compared with the same period of the previous fiscal year, and the Core Operating income margin fell 2.6 points. Using page eight and after, I'd like to explain the results of each segment. First, fiber and textiles. Revenue of the overall segments decreased 2.2% to JPY 504 billion compared with the same period a year earlier, and Core Operating Income increased 1.7% to JPY 35 billion.
Apparel applications were steady, as shipment of the fall winter clothing in Japan was strong overall. The industrial applications fell short of a full recovery of the market condition, especially in the automobile applications, but the group strived to reduce costs. Page nine is the Performance Chemicals segment. Revenue decreased 7.2% to JPY 443.3 billion compared with the same period a year earlier. Cooperating income decreased 15.3% to JPY 28.8 billion. In the regions and chemicals businesses, demand was on a recovery trend in the resins business, as the effect of last fiscal year's production decline by the automobile manufacturers in Japan has resolved.
However, the chemicals business was affected by the worsened market conditions. The film business saw an increase in electronic parts-related demand, but sales of battery separator film were stagnant. In the electronic and information materials business, OLED-related materials and circuit materials were affected by the weak display panel demand and intensified competition in China. Page ten is the Carbon Fiber Composite Materials segment. Revenue decreased 11.4% to JPY 135.4 billion compared with the same period a year earlier, and this segment posted operating income of JPY 9.4 billion, a 19.6% decrease from the same period a year earlier.
The aerospace applications were on a recovery trend, but affected by the inventory adjustment in the supply chain and the appreciation of the yen. In the sports applications, sales of the high-end products for outdoor leisure were steady; however, inventory adjustment of the general-purpose products continued. In the industrial applications, pressure vessel applications entered an adjustment phase. Page 11, in the Environment & Engineering segment, revenue decreased 2.2% to JPY 117 billion compared with the same period a year earlier, and operating income decreased 16.8% to JPY 9.8 billion.
The water treatment business was affected by the concentration of shipments last year for a large-scale project in the Middle East, in addition to the stagnant market conditions in China. As for subsidiaries in Japan, sales of the construction subsidiary were strong, but the engineering subsidiary in Japan saw a decline in revenue due to shifts in project timing. Page 12 is the Life Science segment. Revenue decreased 2% to JPY 25.1 billion compared with the same period a year earlier, and operating income decreased by JPY 0.5 billion to JPY 1.1 billion.
The pharmaceutical business was affected by the impact of the penetration of the generic versions of the drug in Japan, while overseas sales grew mainly in China. In the medical device business, shipment of the mainstay product dialyzers for hemodiafiltration was steady, but affected by persistently high prices of raw materials. Page 13 shows the business results for major subsidiaries and regions. At Toray International, sales were strong mainly in the fibers and textiles, but affected by the cost increase. At the subsidiaries in Southeast Asia, in the fibers and textiles business, demand for apparel applications and automobile applications in the industrial applications was weak.
In the performance chemicals business, spread of ABS resins improved. At the subsidiaries in China, in the fibers and textiles business, the apparel applications were strong. In the performance chemicals business, the chemical business was impacted by the worsened market condition. As for our subsidiaries in the Republic of Korea, sales of the fibers and textiles business decreased stemming from the scale-down of low-profitability applications. However, spread has improved. In the performance chemicals business, sales of battery separator film were stagnant. Next, I'd like to explain the consolidated business forecast for the fiscal year ending March 2026.
Please turn to page 15. The global economy is expected to continue with the gradual recovery phase. While the uncertainties stemming from the Trump tariffs will remain, their impact on the global economy is likely to be limited. The Japanese economy is expected to continue with its gradual recovery. However, the prevailing economic trends will be affected by the direction of the trade policies of the U.S. and the responses from other countries, geopolitical tensions and rising prices of primary products, and the stagnation of the Chinese economy, which may also have a significant impact on the changes in the supply chains and the trade structure in the medium to long term.
For the fiscal year ending March 2026, given the current business performance and the environment, forecasts for revenue, cooperating income, and profit attributable to owners of the parents remain the same overall as the announcement on May 14, despite some changes in the segment breakdowns of revenue and cooperating income. Assumed exchange rate from October onward is JPY 145 per U.S. dollar. Page 16 shows the bi-annual consolidated business forecast for the fiscal year ending March 2026 by segment.
Revenue and cooperating income of all segments are expected to increase, owing to sales expansion in each segment, especially in the fibers and textiles and environment and engineering segments, in addition to the positive effects from strategic pricing and profitability improvement projects. Page 17 shows the comparison between the result of cooperating income in the fiscal year ended March 2025 and the forecast for the fiscal year ending March 2026 with breakdowns into segments. The factors behind the differences are also shown.
Page 18 shows impacts from the U.S. tariff measures and the difference between the initial and the new forecasts for cooperating income by segment. In the flow of goods and holding back on purchases were currently seen in some areas against the backdrop of growing uncertainties triggered by the U.S. policy shift by the Trump administration. Although it is difficult to clearly differentiate the impact from the U.S. tariff measures given the effects caused by the demand decrease, forecasts for the entire cooperating income remain unchanged.
Various factors between the initial and the new forecasts for the cooperating income are shown on the right side of the table. Next, I'd like to explain topics in the first six months of the FY 2025. Page 20 describes the business structure reform based on the four categories of growth potential and profitability as a measure to improve each business field. Toray continues to implement initiatives for low-growth and low-profitability businesses, as shown on the bottom left. In October 2025, the company resolved the divestment of joint venture of battery separator film in Hungary, as well as the sales of equity interest in Japan Vilene Company in November 2025.
Page 21 summarizes the initiatives in DPRO and its effects. In FY 2024, Toray achieved JPY 20 billion of improvement year-on-year through cost reductions and optimization of production. In FY 2025, JPY 10 billion of profitability improvement was expected compared with the previous fiscal year. However, after reviewing the plans based on the delay of sales expansion in polyester staple fiber and large-tow carbon fiber businesses, JPY 7 billion of year-on-year improvement in profitability is expected now. Toray aims to restore profitability through cost reductions, as well as developing and expanding sales of differentiated products in the PP spunbond business and the PET film subsidiary in Europe.
In addition, the company also continues to work on strengthening profitability in businesses that have already become profitable. On page twenty-two, I'll explain about the reduction of cross-share holdings, share buybacks, and the cancellation of shares. Total repurchase price of the cross-share holdings is JPY 109.8 billion in FY 2024. Including sales from 2025 onward, the cumulative sales amount of cross-share holdings will be about JPY 150 billion. Therefore, JPY 50 billion of additional share buybacks are resolved at the board of directors meeting on November 14, 2025.
Furthermore, cancellation of JPY 127 million treasury shares that the company has acquired is also planned. This concludes my presentation. Thank you very much.