CEO Message

Renewed on May 9, 2013

We take this opportunity to express our sincere appreciation for your continued support.

We would like to explain about our Group's consolidated business results for the fiscal year ended March 2013, the last year of the former 3-year medium-term management plan. In this period, the global economy further decelerated due to a relapse of credit insecurity in Europe and concerns over the U.S. financial issues, and the growth rates in China and India also slowed down, which resulted in a net sales of 247.977 billion yen, (a 6.2% year-on-year decrease), an operating income of 13.295 billion yen (a 3.8% year-on-year decrease), an ordinary income of 14.208 billion yen (a 4.3% year-on-year decrease) and net income of 9.134 billion yen (a 4.3% year-on-year decrease). As the result, we could not achieve the original target of the plan.

Under this situation, we started the new 3-year medium-term management plan, "Ready for the Next ! Phase 2 "(FY ending March 2014~FY ending March 2016).

The new 3-year medium-term management plan is designed in line with and consideration of the prior 3-year plan. It also provides a longer-term vision with the aim of securing KWE's position as "Global Logistics Partner" focusing on its customers to offer superior global services. Our strategy is based on three key pillars which all aim to secure our competitive position on par with leading European and U.S. competitors.

The first strategic pillar aims to optimize overall revenue portfolio through a more balanced portfolio of business domains and commodities handled. We are working to expand our sea freight and logistics business to balance the weight of the air freight business. Air freight operations will always be a core of KWE's activities, but we will strive to reduce dependency on this segment and seek to increase such verticals as autos and healthcare.

The second strategic pillar is to expand KWE's presence in emerging countries through volume expansion.

The third strategic pillar aims to strengthen off-shore sales structure and activities; establish best in class operations to maximize operational effectiveness and high quality services. We aim to further improve the quality and breadth of our services in order to aggressively increase off-shore business.

In order to respond to the changing global business environment and diversification of customer needs, KWE is committing its full resources and efforts to ensure customers around the world consistently receive superior service satisfaction.

Concerning our forecast for the fiscal year ending March 2014, we expect to see net sales of 270 billion yen or 8.9% year-on-year increase, operating income of 14.5 billion yen or 9.1% year-on-year increase, ordinary income of 14.5 billion yen or 2.0% year-on-year increase, and net income of 9.2 billion yen or 0.7% year-on-year increase.

Going forward, we will continue to work together as a company to improve the competitiveness in the global market and execute the policies of our new medium-term management plan. I would therefore like to request the continued support of all our shareholders and investors for the foreseeable future.

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