Financial Highlights: The First Quarter Ended June 30, 2021

(Unaudited translation of 'Kessan Tanshin', provided for reference only)July 30, 2021

3. Forecast for the Fiscal Year Ending March 31, 2022

		(¥Million)
	1H/FY2021	FY2021
Revenues	570,000	1,100,000
Operating profit	16,000	35,000
Ordinary profit	232,000	350,000
Profit attributable to owners of parent	225,000	335,000
		( ¥ )
	1H/FY2021	FY2021
Net income per share	1,878.68	2,797.15

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(Unaudited translation of 'Kessan Tanshin', provided for reference only)July 30, 2021

4．Business Performance

(1) Analysis of Operating Results			(¥ Billion)
		Three months	Year-on-year
		From April 1, 2020 to	From April 1, 2021 to	comparison /
		June 30, 2020	June 30, 2021	Variance
	Revenue	251.4	288.8	37.4 / 14.9%
	Operating profit (loss)	(5.1)	8.0	13.1	/	-	%
	Ordinary profit	7.3	104.2	96.9	/	-	%
	Profit attributable to owners of parent	5.4	104.1	98.6	/	-	%
	Exchange rate	¥108.11/US$	¥108.77/US$	¥0.66/US$
	Bunker price*	US$255/MT	US$497/MT	US$242/MT
		*Average	purchase price for all the	major fuel grades

We recorded revenue of ¥288.8 billion, operating profit of ¥8.0 billion, ordinary profit of ¥104.2 billion and profit attributable to owners of parent of ¥104.1 billion in the first three months of the fiscal year 2021. We recorded ¥91.2 billion of equity in net earnings of affiliated companies in non-operating income, mainly due to improved earnings at OCEAN NETWORK EXPRESS PTE. LTD (ONE), an equity method affiliate. The amount of equity in net earnings of affiliated companies we recorded which was attributable to ONE was ¥87.7 billion.

The following is a summary of business conditions including revenue and ordinary profit/loss per business segment.

Upper: Segment Revenue, Lower: Segment Ordinary Profit (Loss)		(¥ Billion)
			Three months	Year-on-year
			From April 1, 2020 to	From April 1, 2021 to	comparison /
			June 30, 2020	June 30, 2021	Variance
Dry Bulk Business	57.6	78.3	20.7	/	35.9%
0.4	6.5	6.1 / 1,452.2%
		79.6	71.1	8.5)	/	10.7%)
Energy and Offshore Business	8.4	4.3	(4.0) /	(48.0%)
Product Transport Business	92.9	118.2	(25.2 /	( 27.2%
		3.3)	90.1	93.5 /	- %
	Containership	(51.2	64.6	13.3	/	26.1%
	Segment	5.9	90.6	84.7 / 1,422.7%
Associated Businesses	23.8	25.4	1.6	/	6.7%
2.6	2.3	0.2) /	11.1%)
Others	5.0	6.2	( 1.1 /	( 23.5%
			0.6	0.8	0.2	/	43.4%

Note: Revenue includes internal sales or transfers among segments

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(Unaudited translation of 'Kessan Tanshin', provided for reference only)

July 30, 2021

(A) Dry Bulk Business

In the Capesize bulker market during the first three months of the fiscal year, the charter rate rose to more than US$40,000 per day in early May, the highest since 2013, due to growing demand for the transportation of raw materials driven by brisk exports of major mining companies and steel manufacturers reflecting rising prices of iron ore and steel products. While the charter rate entered the correction phase after that, it turned up again in early June on the back of the strong market for small- and medium-sized bulkers and iron ore shipments from Australia. In the Panamax bulker market during the first three months of the fiscal year, the charter rate rose from mid-April due to solid demand for the transportation of grain and coal bound for China and continued to rise subsequently, driven by grain shipments from the Atlantic Ocean region to the Far East. Under these market conditions, we secured new time charter contracts and contracts of affreightment by capturing customer demand. We also took steps to improve the efficiency of vessel allocation and profitability by consolidating sales and vessel operations for dry bulkers other than those for the steel mill industry and domestic electric power companies into MOL Drybulk Ltd., which was established in April 2021 through a business and structural integration with Mitsui O.S.K. Kinkai, Ltd. Thanks to the contribution of these initiatives, the dry bulk business posted a year-on-year increase in profit in the first three months of the fiscal year.

1. Energy and Offshore Business
   In the very large crude oil carrier (VLCC) market, the charter rate was exposed to harsh market conditions rarely seen in recent years due to the continuation of coordinated output cuts by the OPEC Plus and the prolonged sluggish oil demand due to COVID-19. The product tanker market also saw the challenging market conditions continue, given reasons such as periodic repairs at refineries and a fall in exports and imports of China due to tax reform for certain petroleum products in the country, in addition to weak demand for petroleum products due to the continued COVID-19 pandemic. The cargo volume of chemical tankers continued to be low due to problems occurring at petrochemical plants caused by the cold wave in the Gulf region of North America. Under these market conditions, the tanker division as a whole suffered a year-on-year decline in profit, despite its efforts in cost reduction and the stable fulfillment of long-term contracts.

The LNG carrier division continued to generate stable profit mainly through existing long-term charter contracts. For the offshore business division, existing FPSO projects and subsea support vessel businesses, etc. were

generally operating steadily. In the FSRU business, one new vessel was put into a long-term contract after delivery. However, the time charter contract for an existing vessel was renewed, and this resulted in a deterioration of profitability year on year.

1. Product Transport Business
   ONE, the Company's equity-method affiliate, saw cargo volume increase markedly from the same period of the previous year when the COVID-19 had made an impact, but encountered supply constraints mainly due to port congestion at major ports in North America and Europe and railway congestion inland in North America. These developments helped tighten the supply-demand balance, and spot freight rates remained considerably higher than the year-ago level. As a result, the containerships business recorded a significant year-on-year increase in profit.

Transportation volume of completed cars increased significantly from the same period of the previous year when it had been affected by the global decrease in automobile production amid the COVID-19 pandemic, although semiconductor supply shortages also had an impact. Profitability improved significantly year on year due to the recovery of cargo movements combined with the effect of the rationalization of vessel allocation.

The business of ferries and coastal RoRo ships secured more shipments than a year ago by capturing solid cargo transportation demand. Although number of passengers were generally recovering, the results were sluggish due to the strong impact of people refraining from going out and traveling due to the declaration of a state of emergency by the Japanese government. Profit deteriorated year on year due to the factors above combined with an increase in ship operation costs caused by rising bunker prices.

(D) Associated Businesses

The real estate business generated stable profit on par with the year-ago level, despite a fall in sales associated with the reconstruction of some buildings held by Daibiru Corporation, the core company in the Group's real estate

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(Unaudited translation of 'Kessan Tanshin', provided for reference only)

July 30, 2021

business. In the cruise ship business, although cruise ship was in operation at the beginning of the fiscal year, the total number of days in operation were short, since it was forced to suspend its service due to the resurgence of COVID-19 infection, resulting in year-on-year decrease in profit. The tugboat business posted a year-on-year increase in profit, reflecting the recovery in the number of vessels requiring tugboat services entering/leaving port.

(E) Others

Other businesses, which are mainly cost centers, such as ship operations, ship management, ship chartering and financing posted a year-on-year increase in profit.

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