Registered number:
FOR THE YEAR ENDED 31 MARCH 2026
TOYOTA CONNECTED EUROPE LIMITED
COMPANY INFORMATION
TOYOTA CONNECTED EUROPE LIMITED
CONTENTS
TOYOTA CONNECTED EUROPE LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2026
The directors present their strategic report for the year ended 31 March 2026.
The principal activity of the company is to leverage the power of data to create products and services in the mobility ecosystem that serve a variety of B2B and B2B2C use cases. All sales are generated within the Toyota Group. The company’s activities are based around its core engineering capabilities across data and mobility products, along with its expertise in design and user experience.
The turnover of the business was £39,456,451 (2025: £36,297,405) with a profit before tax of £12,458,060 (2025: £48,585,370). The results for the year are set out in the Statement of Comprehensive Income on page 16.
The company is in a net assets position with net assets of £19,665,920 (2025: £5,954,085).
During the year ended 31 March 2026, the directors resolved to approve the establishment of a nearshore office in Wroclaw, Poland in order to promote the long-term competitiveness and financial resilience of the Company. For further information regarding the key decision making details of this resolution, see page 4.
The outlook for 2027 is positive, with continued development in both products and services. The company sees an ever growing need for connected vehicles.
Economic risk
The company is exposed to the broader economic climate. Factors such as persistent inflation and a potential decrease in discretionary spending by consumers could adversely affect demand for connected vehicles and associated subscription services from the end customer. The Company will seek to manage this through the pricing of its products and services.
Financial risk
All key financial figures are monitored on a regular basis. The Company has strong support from its parent company and good liquidity therefore the overall risk should remain low for the foreseeable future.
Foreign exchange risk
The company is exposed to foreign exchange risk in the usual course of business, mainly through sales contracts entered in Euros and US Dollars. The company reviews this on a regular basis and is in regular conversations with the parent company to ensure these risks are understood and managed centrally. See Financial instruments on page 6.
Data Security and Cybersecurity Risk
As connected services become integral to our business, the company's reliance on digital systems and data processing increases. This exposes the organization to significant cybersecurity threats, including data breaches, system outages, and malicious attacks. The company is conducting regular security audits and employee training to ensure our defences are resilient against evolving threats.
Compliance and Regulatory Risk
The global regulatory environment for data privacy and emerging technologies is becoming more stringent. The company is exposed to the risk of non-compliance with evolving regulations, such as those governing data sovereignty and the use of artificial intelligence. The company is committed to upholding the highest standards of data privacy across all its operations.
The company is subject to a broad range of laws and regulations, including those relating to data protection, taxation, accounting standards, corporate governance, environmental matters, health and safety, anti-bribery and corruption, and trade compliance. Management monitors developments in these areas and maintains appropriate controls to ensure ongoing compliance and to uphold high standards of ethical and responsible business conduct across its operations.
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TOYOTA CONNECTED EUROPE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
We consider the Company's key performance indicators ("KPIs") are those that communicate the financial performance and strength of the Company, being turnover, profit before tax and net assets.
The Company's key financial indicators during the year and at the end of the year were as follows:
During the year ending 31 March 2026, the revenue of the company increased by 8.7% compared to the prior year. The underlying activity of the Company remains broadly consistent year on year and in line with our business plans. The profit before tax was £12,458,060 which was 31.6% of revenue (2025: £48,585,370, 133.9%). The decrease in profit before tax compared to the prior year is due to a one-off waiving of the intercompany payables, previously owed by the company to related group companies, which resulted in an increase to the profit reported in the prior year.
This profit has led to an increase in net assets at the year end; the closing net assets were £19,665,920 (2025: £5,954,085). Net current asset position as at 31 March 2026 of £98,736,728 (2025: £75,034,084).
We place importance on the following non financial KPIs and strive daily to improve them through communication with stakeholders.
Product/Service Quality
Improving quality is an essential element in order to provide products and services that satisfy our major customer, Toyota Motor Europe NV/SA (“TME”), and other Toyota Group customers. In order to understand Toyota's global mission and accurately reflect the specific needs of customers in our products and services, we are promoting opportunities for communication with customers and fostering close relationships with customers through employees seconded from TME and Toyota. Employees are also trained in the Toyota Production System, which is used to improve the quality of software and designs. Management intends to monitor progress in forging closer links with our customers in order to improve service quality.
Talent Acquisition and Retention
The fields of advanced software development and UX design are evolving at a rapid pace, and the competition for talent is fierce. By basing our business in London, we aim to attract and retain talented people, and the turnover rate of employees is one of our important indicators. We are committed to fostering a positive and inclusive workplace culture that attracts and retains top talent. By investing in our employees' professional development and well being, we aim to create a high performing and engaged workforce. A process is being implemented to track employee average tenure and this will be measured against suitable industry standards.
The fields of advanced software development and UX design are evolving at a rapid pace, and the competition for talent is fierce. By basing our business in London, we aim to attract and retain talented people, and the turnover rate of employees is one of our important indicators. We are committed to fostering a positive and inclusive workplace culture that attracts and retains top talent. By investing in our employees' professional development and well being, we aim to create a high performing and engaged workforce. A process is being implemented to track employee average tenure and this will be measured against suitable industry standards.
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TOYOTA CONNECTED EUROPE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
The directors are aware of their duty under section 172 (1) of the Companies Act 2006 to act in the way which they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole and, in doing so, to have regard (amongst other matters) to:
a)the likely consequences of any decision in the long term;
The directors understand the business and the evolving environment in which the Company operates.
All decisions are taken with the aim of improving the success of the Company in the long term. The strategy set by the Board of Directors is intended to continue running the business effectively, to maximise shareholder value and the needs of its customers in a responsible manner to ensure growth on a long-term basis. The principal decisions taken in the year by the directors are detailed on page 4, within the 'Consequences of decisions made during in the year' sections.
The directors understand the business and the evolving environment in which the Company operates.
All decisions are taken with the aim of improving the success of the Company in the long term. The strategy set by the Board of Directors is intended to continue running the business effectively, to maximise shareholder value and the needs of its customers in a responsible manner to ensure growth on a long-term basis. The principal decisions taken in the year by the directors are detailed on page 4, within the 'Consequences of decisions made during in the year' sections.
b)the interests of the Company’s employees;
The directors communicate regularly to ensure employees understand the Company's values and work together towards a common mission. The Directors recognise that the success of the business depends on attracting, retaining, and motivating talented and capable employees. The Directors consider the implications of decisions which may affect the perception of the Company as a responsible employer, on determining remuneration and benefits, and on providing a healthy and safe workplace environment.
The Directors understand that our people are key to our success and want our employees to be successful both individually and as members of a team. To meet the interests of our employees the Directors actively engage with and listen to their employees through weekly meetings that all employees can attend to hear the latest company updates and raise any questions that they may have.
The communication activities undertaken by the Directors and executive management respects that our colleagues want to be kept informed of changes to the business and to understand that management are aware and responsive to their concerns.
The directors communicate regularly to ensure employees understand the Company's values and work together towards a common mission. The Directors recognise that the success of the business depends on attracting, retaining, and motivating talented and capable employees. The Directors consider the implications of decisions which may affect the perception of the Company as a responsible employer, on determining remuneration and benefits, and on providing a healthy and safe workplace environment.
The Directors understand that our people are key to our success and want our employees to be successful both individually and as members of a team. To meet the interests of our employees the Directors actively engage with and listen to their employees through weekly meetings that all employees can attend to hear the latest company updates and raise any questions that they may have.
The communication activities undertaken by the Directors and executive management respects that our colleagues want to be kept informed of changes to the business and to understand that management are aware and responsive to their concerns.
c)the need to foster the Company’s business relationships with suppliers, customers and others;
The directors believe in developing mutually beneficial long term relationships based on mutual trust with all suppliers. In order to realize a data driven ecosystem, the directors strengthen cooperative relationships with customers and suppliers and maintain appropriate relationships that comply with regulations. We aim to build strong lasting relationships with our customers by holding meetings with them to understand their needs and views and work with the customer to come to an agreement which satisfies our business requirements as well as the customer’s needs.
The directors believe in developing mutually beneficial long term relationships based on mutual trust with all suppliers. In order to realize a data driven ecosystem, the directors strengthen cooperative relationships with customers and suppliers and maintain appropriate relationships that comply with regulations. We aim to build strong lasting relationships with our customers by holding meetings with them to understand their needs and views and work with the customer to come to an agreement which satisfies our business requirements as well as the customer’s needs.
d)the impact of the Company’s operations on the community and the environment;
In order to contribute to the sustainable development of society and the world through its business activities while cooperating with global society, Toyota has been conducting continuous environmental initiatives since the 1960s. Toyota’s aim is to build a corporate group that is admired and trusted by society through ensuring that all employees, including those at consolidated subsidiaries, recognise sustainable policies. As a member of the Toyota Group, we promote business activities that are considerate of society and the environment.
In order to contribute to the sustainable development of society and the world through its business activities while cooperating with global society, Toyota has been conducting continuous environmental initiatives since the 1960s. Toyota’s aim is to build a corporate group that is admired and trusted by society through ensuring that all employees, including those at consolidated subsidiaries, recognise sustainable policies. As a member of the Toyota Group, we promote business activities that are considerate of society and the environment.
e)the desirability of the Company maintaining a reputation for high standards of business conduct; and
As a member of the Toyota Group, "Honesty first, Integrity always" is the most important element of our Code of Conduct. The board’s decisions consider the Company’s code of conduct, we are promoting the Toyota Way and Toyota Culture among our employees. We are aiming to create innovative customer experiences that lead to the mass production of human happiness.
As a member of the Toyota Group, "Honesty first, Integrity always" is the most important element of our Code of Conduct. The board’s decisions consider the Company’s code of conduct, we are promoting the Toyota Way and Toyota Culture among our employees. We are aiming to create innovative customer experiences that lead to the mass production of human happiness.
f)the need to act fairly between members of the Company
The directors ensure that all members are treated equitably, and it fosters trust between the Company and its stakeholders. The directors understand that unfair treatment can lead to disputes, legal action, and damage to the Company's reputation.
The directors ensure that all members are treated equitably, and it fosters trust between the Company and its stakeholders. The directors understand that unfair treatment can lead to disputes, legal action, and damage to the Company's reputation.
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TOYOTA CONNECTED EUROPE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
The directors understand the business and the evolving environment in which the Company operates. All decisions are taken with the aim of promoting the success of the Company for the benefit of its members as a whole, having regard to the long-term consequences of those decisions, the interests of employees, the need to foster business relationships with suppliers and customers, and the desirability of maintaining a reputation for high standards of business conduct.
The key decisions taken in the year ended 31 March 2026 relate to:
1.Establishment of a nearshore office in Wroclaw, Poland; and
2.Adoption of the Strategic Roadmap (Hoshin) for the year ended 31 March 2026.
Details of how these decisions were taken are set out below.
Establishment of a Nearshore Office in Wroclaw, Poland
The directors recognised that, in order to sustain the long-term competitiveness and financial resilience of the Company, it was necessary to address a number of structural challenges facing the business. Following a thorough assessment of options, the directors resolved at their board meeting held on 27 October 2025 to approve the establishment of a nearshore office in Wroclaw, Poland.
Wroclaw was selected following a careful evaluation of potential locations, having regard to the availability of local engineering and technology talent, the proximity to affiliate companies within the Toyota group, and the practical benefits of establishing a presence in that location.
The directors considered the appropriate legal structure for the new office and concluded that a branch office was the most suitable form, given the administrative simplicity of that structure and the importance of maintaining full alignment between the new office and the Company's existing operations and culture.
The directors reviewed the financial and strategic case for the investment, including the expected returns over the medium term and the anticipated impact on the Company's operational capabilities and cost structure. The directors were satisfied that the investment was consistent with the long-term interests of the Company and its members.
The directors also gave consideration to governance, management, and cultural integration, recognising that the success of the new office would depend on strong leadership, clear standards, and close collaboration with the London office and affiliate companies. Having considered all relevant factors, the directors unanimously resolved to approve the establishment of the nearshore office.
Adoption of the Strategic Roadmap (Hoshin)
The directors recognise that the sustained success of the Company depends on setting a clear, measurable strategic direction that aligns the efforts of the entire organisation around common goals. The Company uses a Hoshin planning methodology - drawn from Toyota's broader management framework - to establish its strategic priorities for each financial year, cascading those priorities throughout the organisation and creating accountability at every level.
The decision was made to build upon the broader Toyota Hoshin to ensure continuity and relevance of goals. The Board recognised that setting a clear and measurable direction would enable the company to align all organisational activities with overarching business goals. It also built further on the previous year’s goals. The five pillars for this year were: High Performance; Partner of Choice; Operational Efficiency; Built-in Quality; and Company Governance.
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TOYOTA CONNECTED EUROPE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
Directors' statement of compliance with duty to promote the success of the Company in accordance with S172 (1) Companies Act 2006 (continued)
Consequences of decisions made during the year (continued)
Adoption of the Strategic Roadmap (Hoshin) (continued)
Consequences of decisions made during the year (continued)
Adoption of the Strategic Roadmap (Hoshin) (continued)
The directors, working with the Senior Leadership Team and following guidance from Toyota Head Offices, followed an iterative planning process to set the strategic direction for the year ahead. The Senior Leadership Team established the overarching organisational vision, which was then broken down into pillar-level targets. Heads of Teams and Team Leads were engaged to cascade the top-level priorities, with catch-ball sessions organised with all team members to enable feedback loops on the detail of the strategic goals before they were finalised. This approach ensures that strategy is developed collaboratively, strengthening the commitment of the wider organisation to achieving the agreed goals.
The directors intend to position the company to ensure sustained development in competitive technologies, to support making of sound investment decisions, enabling the company to respond rapidly to market changes and position itself with strong, long-term growth in its future.
Looking ahead, the Senior Leadership Team will refine the Hoshin pillars to reflect the evolving priorities of the business. The directors intend to build on the progress made in the year ended 31 March 2026, with a particular focus on completing initiatives that were initiated but not fully delivered, and on integrating the Wroclaw office into the Company's planning and operational framework.
The financial statements on pages 16 to 39 were approved by the Board of Directors on
and signed on its behalf.
and signed on its behalf.
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TOYOTA CONNECTED EUROPE LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2026
The directors present their report and the financial statements for the year ended 31 March 2026.
The profit for the year, after taxation, amounted to £13,711,835 (2025 - £42,969,753).
The directors do not propose, nor paid a dividend during the year (2025 - £Nil).
The directors plan to put into practice the following vision to strengthen our core competencies and become the preferred partner of our customers.
Short-Term Vision
Short-Term Vision
∙Deliver in the most cost efficient manner with high quality and delight our customers;
∙Be recognised as a leader in software development in our customers, through technological innovation and unique selling points derived from our knowledge of Toyota;
∙Leverage core competencies (data, cloud & design) to grow our revenue in sales enablement domains.
Mid-Term Vision
∙Be the software development partner of choice for the existing customers and other EU region stakeholders;
∙Monitor future of Toyota & Market and play role in early stage to capitalize on future opportunities (move up the value chain);
∙Continually strive to create products related to mobility, new domain and Innovation.
The Company has a normal level of exposure to prices, liquidity and cash flow risks arising from trading activities which are conducted in Pounds Sterling, Euros, Polish Zloty, US dollars and Yen. The foreign exchange risk is managed centrally at a group level; as a result, the Company has not entered any hedging arrangements in respect of risks relating to trade debtors or trade creditors.
The Directors who served throughout the year and up to the date of signing the financial statements, unless otherwise stated, were as follows:
F C Okoisor (resigned 1 May 2025)
F C Okoisor (resigned 1 May 2025)
S Taniguchi
K Murata (appointed 1 May 2025)
C Pleier (appointed 1 May 2025)
M Hayakawa
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TOYOTA CONNECTED EUROPE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
As permitted by the Articles of Association, the Directors have the benefit of an indemnity which is a qualifying third party indemnity provision as defined by Section 234 of the Companies Act 2006. The indemnity was in force throughout the last financial year and is currently in force. The Company also purchased and maintained throughout the financial year Director's and Officers' liability insurance in respect of itself and its Directors.
Expenditure on the research phase of the Company’s projects is expensed as they are incurred. During the year £209,680 of development costs were capitalised (2025: £160,085).
Stakeholder engagement is important to the Company and the Company has a diverse group of stakeholders.
The Board are made aware of the needs and requirements of these stakeholders through regular discussions with the departments who have the contact with them. If any concerns are raised, the Board acts to ensure that the feedback is built into future decision making.
Customers
The needs of the customer, whether it is the Company’s immediate customer, such as TME, or the ultimate customer who buys the vehicle are important to the Company. The flexibility that the Company provides in terms of fulfilling orders to its customers is a key contributor to this.
Suppliers
The supplier network that supports the Company is essential to its success. The Company develops mutually beneficial long term relationships based on shared trust. This is achieved by having close and wide ranging communications with a focus on sharing knowledge.
The Board are made aware of the needs and requirements of these stakeholders through regular discussions with the departments who have the contact with them. If any concerns are raised, the Board acts to ensure that the feedback is built into future decision making.
Customers
The needs of the customer, whether it is the Company’s immediate customer, such as TME, or the ultimate customer who buys the vehicle are important to the Company. The flexibility that the Company provides in terms of fulfilling orders to its customers is a key contributor to this.
Suppliers
The supplier network that supports the Company is essential to its success. The Company develops mutually beneficial long term relationships based on shared trust. This is achieved by having close and wide ranging communications with a focus on sharing knowledge.
The Company during the year opened a branch in Wroclaw, Poland.
Methodology
This report is undertaken in accordance with HM Government Environmental Reporting Guidelines: Including streamlined energy and carbon reporting guidance. The methodology used to prepare our energy and greenhouse gas (GHG) emission inventory follows the World Resources Institute Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard.
GHG emissions are calculated using the UK Government's conversion factors for company reporting. The operational control approach is used to define the organisational boundary.
This report is undertaken in accordance with HM Government Environmental Reporting Guidelines: Including streamlined energy and carbon reporting guidance. The methodology used to prepare our energy and greenhouse gas (GHG) emission inventory follows the World Resources Institute Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard.
GHG emissions are calculated using the UK Government's conversion factors for company reporting. The operational control approach is used to define the organisational boundary.
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TOYOTA CONNECTED EUROPE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
Energy Consumption and Greenhouse Gas Emissions (continued)
Note on cloud emissions scope: Cloud services emissions are reported for the EMEA (Europe, Middle East, and Africa) region, representing the services that primarily support the company's UK and European operations.
Total CO2e emissions increased by approximately 55% year-on-year, from 344.43t in the year ended 31 March 2025 to 532.41t in the year ended 31 March 2026. Toyota Connected Europe Limited ("TCEU") grew significantly during this year as turnover grew to £39.5 million and the majority of the increase in absolute emissions is directly attributable to that growth. On a per-£'000 turnover basis, emissions increased from 9.49kg to 13.49kg. While these intensity increases reflect areas where further improvement is needed, they are considered in the context of the structural and operational changes described below.
The increase in total emissions is attributable to three principal drivers:
1.Business travel: Business travel emissions increased by 35%, from 158.56t to 214.43t. This reflects a continued normalisation of in-person collaboration across the Toyota group following the post-pandemic period, including increased attendance at group-wide meetings, product launches, and cross-regional working sessions. TCEU recognises that not all of this travel is avoidable, but is actively working to reduce its travel footprint though the measures described below.
2.Server emissions: Server emissions increased by 77%, from 173.87t to 308.16t. This increase is driven by the growth of TCEU's product and services portfolio, which relies on cloud-based infrastructure to deliver connected vehicle and mobility services across the EMEA region. As TCEU's customer base and data processing volumes have grown, so has the associated cloud energy demand. TCEU is committed to addressing the through cloud efficiency measures described in the Future Initiatives section below.
3.Organisational boundary expansion: Office electricity consumption decreased slightly, from 57.98 MWh (12.00 tCO2e) in YE2025 to 55.46 MWh (9.82 tCO2e) in YE2026, demonstrating the continued effectiveness of TCEU's building-level energy efficiency measures despite headcount growth.
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TOYOTA CONNECTED EUROPE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
Energy Efficiency Actions and Reduction Efforts
During the reporting period, TCEU maintained its established energy efficiency measures and continued to focus on reducing emissions across all areas of its operations. The reduction in office electricity consumption demonstrates the effectiveness of the building-level measures in place. TCEU acknowledges the increases in business travel and cloud infrastructure emissions and has identified specific actions to address these, as set out below.
During the reporting period, TCEU maintained its established energy efficiency measures and continued to focus on reducing emissions across all areas of its operations. The reduction in office electricity consumption demonstrates the effectiveness of the building-level measures in place. TCEU acknowledges the increases in business travel and cloud infrastructure emissions and has identified specific actions to address these, as set out below.
The following energy efficiency initiatives continued throughout the reporting period:
1.Renewable energy procurement: The electricity contract prioritises renewable energy sources where possible, reducing the carbon intensity of our electricity consumption and supporting the transition to clean energy.
2.LED lighting: Energy-efficient LED lighting is in place throughout our facilities, significantly reducing electricity consumption compared to traditional lighting.
3.Automated lighting controls: Motion sensors automatically activate lighting when areas are occupied and switch off when no motion is detected, eliminating energy waste from lights left on in unoccupied spaces.
4.Flexible working arrangements: Our remote working policy allows employees to work from home on designated days, reducing office occupancy and lowering electricity consumption from heating, cooling, lighting, and equipment use.
5.Smart building systems: Automated timeout systems ensure that lighting and other electrical equipment power down after periods of inactivity, further reducing unnecessary energy consumption.
We continue to focus on reducing our environmental footprint through:
1.Employee engagement: Regular training is provided to staff on energy efficiency and environmental awareness, ensuring all team members understand their role in reducing our environmental impact.
2.Waste reduction initiatives: We actively promote recycling throughout our facilities, with clear guidance to employees on waste segregation and recycling practices to minimise environmental footprint.
3.Sustainable transport: Our cycle-to-work scheme encourages environmentally-friendly commuting options, reducing carbon emissions from daily travel while promoting employee health and wellbeing.
4.Operational efficiency: We maintain energy-efficient practices through continued monitoring of our automated systems and lighting controls to ensure optimal performance.
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TOYOTA CONNECTED EUROPE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
Future Initiatives
Looking ahead, TCEU is committed to further reducing our environmental impact through the following planned initiatives:
Looking ahead, TCEU is committed to further reducing our environmental impact through the following planned initiatives:
1.Reducing business travel emissions: TCEU will implement further travel pre-approval questions requiring employees to consider virtual alternatives before booking international travel. For necessary travel to Brussels and other European destinations, low-carbon options such as Eurostar rail services will be prioritised over air travel. We will also expand the use of remote meeting and collaboration technologies to reduce the frequency of in-person attendance at overseas meetings. The objective is to stabilise business travel emissions in absolute terms in the year ending 31 March 2027, notwithstanding continued headcount growth.
2.Continued building-level efficiency: TCEU will continue to monitor and maintain its automated lighting controls, smart building systems, and flexible working arrangements at the London office, with the aim of sustaining or improving on the reduction in office electricity consumption achieved in the current reporting period.
TCEU's environmental initiatives directly support Toyota's global Environmental Challenge 2050, which aims to eliminate the negative environmental impact of our operations and create a net positive impact on society and the planet. Our efforts specifically contribute to the following Toyota Environmental Challenges:
1.Plant Zero CO2 Emissions Challenge: Through our energy efficiency measures, LED lighting, automated controls, and remote working policies, we are working towards minimising CO2 emissions from our operations in support of Toyota's goal of achieving carbon neutrality across all facilities by 2050.
2.Challenge of establishing a recycling-based society: Our recycling programmes and waste reduction initiatives contribute to Toyota's commitment to creating a circular economy and minimising waste across all business operations.
3.Life Cycle Zero CO2 Emissions Challenge: By reducing business travel through enhanced virtual collaboration and prioritising low-carbon transport options, we are helping to reduce emissions across the entire lifecycle of Toyota's business activities.
4.Challenge of establishing a future society in harmony with nature: Our sustainable transport initiatives, including the cycle-to-work scheme, and our focus on environmental awareness training demonstrate our commitment to promoting sustainable practices that benefit both our business and the broader community.
As part of the Toyota family, we recognise that every operation, regardless of size, has a role to play in achieving these ambitious environmental goals. Our initiatives are focused on office and technology operations, but they reflect our commitment to the same principles of continuous improvement (kaizen) and environmental stewardship that drive Toyota's global sustainability efforts.
Energy consumption figures are based on actual meter readings and supplier invoices.
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TOYOTA CONNECTED EUROPE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulation.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 101 “Reduced Disclosure Framework”, and applicable law). Under company law, directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.
In preparing the financial statements, the directors are required to:
∙select suitable accounting policies and then apply them consistently;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙make judgements and accounting estimated that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The auditors, PricewaterhouseCoopers LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
There have been no significant events affecting the Company since the year end.
This report was approved by the board and signed on its behalf.
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TOYOTA CONNECTED EUROPE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TOYOTA CONNECTED EUROPE LIMITED
FOR THE YEAR ENDED 31 MARCH 2026
In our opinion, Toyota Connected Europe Limited's financial statements:
Independence
We remained independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, which includes the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the company's ability to continue as a going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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TOYOTA CONNECTED EUROPE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TOYOTA CONNECTED EUROPE LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
The other information comprises all of the information in the Annual Report other than the financial statements and our auditors’ report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of assurance thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report based on these responsibilities.
With respect to the Strategic report and Directors' report, we also considered whether the disclosures required by the Companies Act 2006 have been included.
Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain opinions and matters as described below.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report based on these responsibilities.
With respect to the Strategic report and Directors' report, we also considered whether the disclosures required by the Companies Act 2006 have been included.
Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain opinions and matters as described below.
Strategic report and Directors' report
In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic report and Directors' report for the year ended 31 March 2026 is consistent with the financial statements and has been prepared in accordance with applicable legal requirements.
In light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we did not identify any material misstatements in the Strategic report and Directors' report.
As explained more fully in the Directors' responsibilities statement, the directors are responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The directors are also responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
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TOYOTA CONNECTED EUROPE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TOYOTA CONNECTED EUROPE LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
Auditors’ responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Based on our understanding of the company and industry, we identified that the principal risks of non-compliance with laws and regulations related to the tax jurisdictions the company operates in and the Companies Act 2006, and we considered the extent to which non-compliance might have a material effect on the financial statements. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to manipulate financial results and potential management bias in the selection and application of significant accounting judgements and estimates. Audit procedures performed by the engagement team included:
∙Discussions with management, including consideration of known or suspected instances of non-compliance with laws and regulations, bribery and fraud, including performing additional procedures where applicable;
∙Reviewing board meeting minutes and significant contracts;
∙Identifying and testing the validity of journal entries, in particular journal entries posted with unusual account combinations;
∙Challenging assumptions made by management in the selection and application of significant accounting judgements and estimates;
∙Incorporating elements of unpredictability in our audit procedures; and
∙Reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities for the audit of the financial statements is located on the FRC's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors' report.
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TOYOTA CONNECTED EUROPE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TOYOTA CONNECTED EUROPE LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2026
Use of this report
This report, including the opinions, has been prepared for and only for the company's members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
This report, including the opinions, has been prepared for and only for the company's members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
Other required reporting
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our opinion:
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our opinion:
∙we have not obtained all the information and explanations we require for our audit; or
∙adequate accounting records have not been kept by the company or returns adequate for our audit have not been received from branches not visited by us; or
∙the company's financial statements are not in agreement with the accounting records and returns; or
∙certain disclosures of directors' remuneration specified by law are not made.
We have no exceptions to report arising from this responsibility.
for and on behalf of
Chartered Accountants and Statutory Auditors
Watford
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TOYOTA CONNECTED EUROPE LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2026
Page 16
TOYOTA CONNECTED EUROPE LIMITED
BALANCE SHEET
AS AT 31 MARCH 2026
Page 17
TOYOTA CONNECTED EUROPE LIMITED
BALANCE SHEET (CONTINUED)
AS AT 31 MARCH 2026
The financial statements on pages 16 to 39 were approved and authorised for issue by the board and were signed on its behalf by
The notes on pages 20 to 39 form part of these financial statements.
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TOYOTA CONNECTED EUROPE LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2026
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Toyota Connected Europe Limited is a private company limited by shares incorporated in United Kingdom. The Company is registered and domiciled in England, United Kingdom. The address of the registered office is 2nd Floor 80 Turnmill Street, London, EC1M 5QU. The principal activity of the company is to leverage the power of data to create products and services in the mobility ecosystem that serve a variety of B2B, B2B2C and B2C use cases. The company’s activities are based around its core engineering capabilities across data and mobility products, along with its expertise in design and user experience.
The accounting policies as set out below have unless otherwise stated been applied consistently to all years stated.
The accounting policies as set out below have unless otherwise stated been applied consistently to all years stated.
2.Accounting policies
The preparation of financial statements in compliance with FRS 101 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).
The financial statements are prepared on a going concern basis.
New standards applicable from 1 April 2025
The application of the following new standards or amendments is mandatory for the annual reporting period commencing 1 April 2025, but the impact on the Company financial statements is immaterial:
New standards applicable from 1 April 2025
The application of the following new standards or amendments is mandatory for the annual reporting period commencing 1 April 2025, but the impact on the Company financial statements is immaterial:
∙Lack of Exchangeability - Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates
There are no new standards or amendments or IFRIC interpretations that are not yet effective that would be expected to have material impact on the company's financial statements.
The following principal accounting policies have been applied:
Page 20
TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
The Company has taken advantage of the following disclosure exemptions under FRS 101:
∙the requirements of IFRS 7 Financial Instruments: Disclosures
∙the requirements of paragraphs 91-99 of IFRS 13 Fair Value Measurement
∙the requirements of the second sentence of paragraph 110 and paragraphs 113(a), 114, 115, 118, 119(a) to (c), 120 to 127 and 129 of IFRS 15 Revenue from Contracts with Customers
∙the requirements of paragraph 52, the second sentence of paragraph 89, and paragraphs 90, 91 and 93 of IFRS 16 Leases. The requirements of paragraph 58 of IFRS 16, provided that the disclosure of details in indebtedness relating to amounts payable after 5 years required by company law is presented separately for lease liabilities and other liabilities, and in total
∙the requirement in paragraph 38 of IAS 1 'Presentation of Financial Statements' to present comparative information in respect of:
- paragraph 73(e) of IAS 16 Property, Plant and Equipment;
∙the requirements of paragraphs 10(d), 10(f), 16, 38A, 38B, 38C, 38D, 40A, 40B, 40C, 40D, 111 and 134-136 of IAS 1 Presentation of Financial Statements
∙the requirements of IAS 7 Statement of Cash Flows
∙the requirements of paragraph 17 and 18A of IAS 24 Related Party Disclosures
∙the requirements in IAS 24 Related Party Disclosures to disclose related party transactions entered into between two or more members of a group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member
∙the requirements of paragraphs 130(f)(ii), 130(f)(iii), 134(d)-134(f) and 135(c)-135(e) of IAS 36 Impairment of Assets
∙the requirements of paragraph 88A to 88D of IAS 12 Income Taxes.
This information is included in the consolidated financial statements of Toyota Motor Corporation for the year ended 31 March 2026 and these financial statements may be obtained from Toyota Cho, Toyota City, Aichi Prefecture, Japan 471 8571.
The company recorded a net profit before tax of £12,458,060 and is in a net current assets position of £98,736,728 as at 31 March 2026. The net current assets position is caused by an increase in its cash and cash equivalents and reduction in short term creditors, both of which strengthen the company's Balance Sheet. Given the financial position of the company and its reliance on intercompany contracts, the directors have received confirmation from its immediate parent company, Toyota Connected Corporation, that it will continue to support the Company for at least one year after these financial statements are signed. The directors have reviewed the cash flow projections for the next 12 months and have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. This assessment included a review of the Company’s latest forecasts and cash flow projections, together with sensitivity analysis reflecting severe but plausible downside scenarios, including reductions in revenue growth. Based on the information above, the Company’s forecasts and the continued availability of financial support from its immediate parent, the directors consider it appropriate to prepare the financial statements on a going concern basis.
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
The performance obligations and consideration are identified in the contract between the Company and the customer.
The revenue recognition criteria in IFRS15 are applied using the following 5 step model:
1. Identify the contract(s) with the customer
2. Identify the performance obligations in the contract
3. Determine the transaction price
4. Allocate the transaction price to the performance obligations
5. Recognise revenue when, or as, each performance obligation is satisfied.
For time and materials contracts and fixed term contracts to provide services, a contract or quotation is formed between the customer and supplier when a contract is signed by both parties. The distinct performance obligation can be readily identified by the services defined in the contract. Revenue should be recognised when the sole performance obligation has been fulfilled as defined in the contract. The revenue from providing services is recognised in the accounting period in which the services are rendered and the revenue to be recognised in future periods is recorded in deferred income.
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
Research and development expenditure credits are accounted for as government grants where there is reasonable assurance that the Company will comply with the relevant conditions and that the credit will be received. Credits relating to expenditure recognised in profit or loss are recognised in profit or loss on a systematic basis in the period in which the related expenditure is recognised.
The credit is presented within operating profit as other operating income.
The credit is presented within operating profit as other operating income.
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
Intangible assets under the course of development are not amortised until they are completed and brought into use. During the current and prior year no amortisation has been recognised.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
The cost of work in progress comprises design costs, raw materials, direct labour, other direct costs and related production overheads (based on normal operating capacity), that relate to revenue that will be recognised in future periods. Recognition and release of work in progress depends on the timing of the work performed and the timing of the corresponding revenue being recognised.
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
2.Accounting policies (continued)
The Company always recognises lifetime ECL for trade receivables and amounts due on contracts with customers. No material loss allowance is recognised when the ECL is assessed to be immaterial or nil. The expected credit losses on these financial assets are estimated based on the Company's historical credit loss experience, adjusted for factors that are specific to the debtors, general economic conditions and an assessment of both the current as well as the forecast direction of conditions at the reporting date, including time value of money where appropriate. Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of a financial instrument.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
Judgement Deferred tax assets
The recognition of the deferred tax assets is dependent on there being sufficient probable future taxable profits against which the assets could be utilised. The company in the current year has recognised deferred tax asset on tax losses and other timing differences on the basis of making an expected profit in year ended 31 March 2027 and future periods. Consideration has been given on the level of uncertainty in the current economic environment and the uncertainty this creates for medium term taxable profit forecasts, management considers it appropriate to recognise deferred tax assets.
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Page 28
TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Page 30
TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Page 31
TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
14.Tax on profit (continued)
There were no factors that may affect future tax charges.
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Page 35
TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Page 36
TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
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TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
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Page 38
TOYOTA CONNECTED EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2026
Profit and loss account
The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £862,639 (2025: £831,272). Contributions totalling £Nil (2025: £99,158) were payable to the fund at the balance sheet date and are included in other creditors.
The Company's immediate parent company is Toyota Connected Corporation. Its ultimate parent undertaking and controlling party is Toyota Motor Corporation.
The smallest and largest group in which the Company is a member of and which the financial statements are consolidated into isToyota Motor Corporation . Its registered office address is 1 Toyota Cho, Toyota City, Aichi Prefecture, Japan 471 8571 where copies of the consolidated financial statements can be obtained.
The smallest and largest group in which the Company is a member of and which the financial statements are consolidated into is
Page 39