I'm Nakanishi, President of Mitsubishi Corporation. Thank you for taking the time to join us today for our fiscal 2026 second quarter earnings presentation. I will start with the highlights of our results and then update you on our progress under Corporate Strategy 2027. Please turn to slide three of the earnings presentation. First, our fiscal 2026 second quarter results were solid. We made steady progress on our Enhance and Reshape initiatives and on business portfolio recycling. In our resource businesses, we also improved the performance of our existing assets and captured the benefits of higher commodity prices. Based on our first half results and the current business environment, we are raising our full-year forecasts. We now expect underlying operating cash flow of JPY 1,380,000,000,000 and consolidated net income of JPY 1,200,000,000,000 . Both would be record highs.
Taking into account the share buybacks I will discuss later, we expect fiscal year 2026 ROE to be 12.7%. Next, I'll discuss our progress under Corporate Strategy 2027. Please turn to slide four. In fiscal year 2026, our initiatives through fiscal 2025 positioned us to capture the benefits of stronger market conditions. As a result, we expect our Enhance and Reshape initiatives to lift fiscal 2026 earnings by JPY 240 billion above what we assumed in our fiscal 2026 plan. Looking ahead to fiscal 2027, we assume the current stronger-than-expected market tailwinds will fade. Even on that basis, we aim to achieve more than JPY 1,200,000,000,000 in net income and ROE of at least 12% through contributions from deals already executed and stronger earnings from existing businesses. Next, I will highlight some of the steps we've taken this fiscal year to support medium to long-term growth.
Under Enhance and Reshape, we made a final investment decision on the LNG Canada expansion project and decided to bring in a partner to the liquefaction infrastructure holding company. We aim to improve capital efficiency and further broaden our earnings base while retaining our role in project governance and commercial activities. Under Create, we made a final investment decision on the Copper World Copper Development Project in the U.S. The project will help secure a stable supply of copper for which demand is expected to grow over the medium to long term. Production is scheduled to start in the second half of 2029. We also plan to make an additional investment in Ayala Corporation in the Philippines. Ayala has a broad business base in a growing market. We'll work more closely with them to create new growth opportunities. Next, I'll discuss what we're doing to reshape our business portfolio.
This fiscal year, we are stepping up senior management oversight to drive a bold transformation of the portfolio. Specifically, we have expanded the scope of our reviews to cover every business with issues identified against quantitative criteria. We're assessing what improvements can be made and whether any businesses need to be replaced in the portfolio. We are also assessing our strategy and whether to retain our holdings by business area wherever changes in market structure or other factors call for a review of our existing strategy. We will continue to advance our Enhance, Reshape, and Create initiatives and remain focused on raising ROE further with 12% as a milestone along the way. At the same time, to sustain growth beyond that milestone, we'll keep recycling our business portfolio to direct capital towards areas with higher growth potential and greater capital efficiency.
By continually pursuing new growth opportunities, we aim to increase corporate value. Finally, in light of our recent performance and faster-than-expected progress in business recycling, we reviewed our cash flow allocation plan and approved JPY 1 trillion in share buybacks. We continue to have a strong pipeline of high-quality investments. We will make timely decisions on how to use any additional cash available for allocation, with growth investments as our main priority. That concludes my remarks. I will now hand over to our CFO, Shimazu, who will take you through the results. Thank you for your attention.
I am Shimazu, CFO. I will take you through our financial results. Please turn to slide six. For the first half of fiscal 2026, in Q2, underlying operating cash flow rose by JPY 281.8 billion year-on-year to JPY 728.1 billion. Consolidated net income increased by JPY 263.9 billion to JPY 619.7 billion.
As in the first quarter, our copper, steelmaking, coal, and LNG businesses were the main beneficiaries of favorable market conditions. Combined with steady asset recycling across our segments, this led to a substantial year-on-year increase in earnings. As President Nakanishi mentioned at the outset, given our solid earnings performance to date and stronger cash generation, we are raising our full-year forecasts.
We have also been more selective about the investments in our pipeline and refined our capital allocation plan. As a result, we have authorized new share buybacks of up to JPY 1 trillion. With this earnings growth and our flexible approach to capital management, we expect fiscal 2026 ROE to reach 12.7%. This would achieve our Corporate Strategy 2027 target of at least 12% ROE one year ahead of schedule. Next, I will explain our updated outlook for cash flow allocation under Corporate Strategy 2027. Please turn to slide seven.
We revised our cash flow allocation plan to reflect solid underlying operating cash flow, faster business recycling to make our portfolio more resilient, and share buybacks to optimize our capital structure. On the inflow side, we expect an increase of JPY 100 billion in underlying operating cash flow and JPY 500 billion in proceeds from divestments, for a total increase of JPY 600 billion. On the outflow side, we expect an additional JPY 200 billion in create investments and JPY 1 trillion in share buybacks, for a total increase of JPY 1,200,000,000,000 . We will maintain investment discipline and direct any additional allocations primarily toward growth investments. Please also refer to slides eight through 15 for actual cash flows and results by segment.