⚠ Free Cash Flow Turned NegativeModerate threat

Mitsui & Co. (8031) — threat to the moat

Rhodes Ridge turned Mitsui's free cash flow negative for a year and pushed debt up.

Mitsui's free cash flow was ¥855.5 billion in the year to March 2025 and minus ¥80.6 billion in 20261. The swing came from investment: cash used in investing activities rose from ¥162.0 billion to ¥1,033.5 billion2, and purchases of property, plant and equipment were ¥1,108.4 billion, of which Rhodes Ridge was ¥723.8 billion3.

Free cash flow (¥ bn, years to March)625.72022869.22023436.92024855.52025-80.62026Negative value shown as magnitude; Mitsui Integrated Report 2026
Positive for four years, then negative.

Net interest-bearing debt rose from ¥3,330.1 billion to ¥4,139.0 billion4, and the net debt-to-equity ratio from 0.44 to 0.475. In the first quarter of the current year it reached 0.496.

A year of heavy investment is not a problem in itself. It becomes one if returns to shareholders, which the company has committed to at over 50% of core operating cash flow7, have to be funded with debt for long.

The investment programme is visible in the depreciation line too: ¥333.2 billion in the latest year and ¥360.0 billion forecast for the current one8. The assets being built will add to it as they come into service.

The measure is free cash flow in the current year. A return to positive figures would show the investment year was a peak rather than a new level.

References
  1. ReportedMitsui's free cash flow was ¥855.5 billion in the year to March 2025 and minus ¥80.6 billion in 2026.
    Mitsui & Co. Integrated Report 2026, data section - the five-year financial data: market capitalisation, PER, PBR, ROE, net debt, free cash flow, asset recycling and payout. — FY to March 2022-2026 · publ. 2026 · source ↗
  2. ReportedThe swing came from investment: cash used in investing activities rose from ¥162.0 billion to ¥1,033.5 billion, and purchases of property, plant and equipment were ¥1,108.4 billion, of which Rhodes Ridge was ¥723.8 billion.
    Mitsui & Co. Integrated Report 2026, data section - results by operating segment: gross profit, equity-method profit, dividend income, core operating cash flow and total assets. — FY to March 2022-2026 · publ. 2026 · source ↗
  3. ReportedThe swing came from investment: cash used in investing activities rose from ¥162.0 billion to ¥1,033.5 billion, and purchases of property, plant and equipment were ¥1,108.4 billion, of which Rhodes Ridge was ¥723.8 billion.
    Mitsui & Co., Consolidated Financial Results for the year ended March 31, 2026 (IFRS) - the consolidated statements of income, financial position and cash flows, segment information, dividends, buybacks and the forecast for the year to March 2027. — FY to March 2026 · publ. 1 May 2026 · source ↗
  4. ReportedNet interest-bearing debt rose from ¥3,330.1 billion to ¥4,139.0 billion, and the net debt-to-equity ratio from 0.44 to 0.47.
    Mitsui & Co. Integrated Report 2026, data section - the five-year financial data: market capitalisation, PER, PBR, ROE, net debt, free cash flow, asset recycling and payout. — FY to March 2022-2026 · publ. 2026 · source ↗
  5. ReportedNet interest-bearing debt rose from ¥3,330.1 billion to ¥4,139.0 billion, and the net debt-to-equity ratio from 0.44 to 0.47.
    Mitsui & Co. Integrated Report 2026, data section - the five-year financial data: market capitalisation, PER, PBR, ROE, net debt, free cash flow, asset recycling and payout. — FY to March 2022-2026 · publ. 2026 · source ↗
  6. ReportedIn the first quarter of the current year it reached 0.49.
    Mitsui & Co., Consolidated Financial Results for the three months ended June 30, 2026 (IFRS) - revenue, profit, segment results on the new basis, core operating cash flow and the balance sheet. — April-June 2026 · publ. 4 August 2026 · source ↗
  7. ReportedIt becomes one if returns to shareholders, which the company has committed to at over 50% of core operating cash flow, have to be funded with debt for long.
    Mitsui & Co., Consolidated Financial Results for the three months ended June 30, 2026 (IFRS) - revenue, profit, segment results on the new basis, core operating cash flow and the balance sheet. — April-June 2026 · publ. 4 August 2026 · source ↗
  8. ReportedThe investment programme is visible in the depreciation line too: ¥333.2 billion in the latest year and ¥360.0 billion forecast for the current one.
    Mitsui & Co., Consolidated Financial Results for the year ended March 31, 2026 (IFRS) - the consolidated statements of income, financial position and cash flows, segment information, dividends, buybacks and the forecast for the year to March 2027. — FY to March 2026 · publ. 1 May 2026 · source ↗
Sources
Generated September 24, 2026