Briefing Material[PDF:1,986KB]

Financial Results for Q2 FY2024, and Forecast for Full-year FY2024

November 6, 2024

©NYK Group. All rights reserved.

Contents

1. Overview of Financial Results for 2nd Quarter FY2024
2. Forecast for Full-year FY2024

Progress of

Medium-term Management Plan

Appendix

Segment Overview

Fleet in Operation

(Attachment)

Ocean Network Express

Financial Results for FY2024 2nd Quarter

p.3-8

p.9-14

p.15-21

p.22-27

©NYK Group. All rights reserved.

2

1. Overview of the Q2 Results for FY2024

Results

H1 review (year-on-year comparison)

Revenues: JPY1,316.8 billion (up JPY148.4 billion)

• Dry Bulk - Revenue increased in line with a year-on-year increase in market levels for the Capesize and all the other vessel segments. (up JYP52.5 billion)
• Logistics - Revenue increased resulting from an increase in handling volumes (up JYP62.5 billion)

Recurring profit: JPY289.2 billion (up JPY129.9 billion)

• Liner Trade - Market levels for freight increased, impacted by tight supply-demand conditions caused by the situation in the Red Sea (up JYP129.9 billion)

Net income: JPY265.8 billion (up JPY152.5 billion)

Shareholder return: Interim dividend (per share): JPY130 (unchanged) Share repurchase

• The share repurchase is being implemented for the period from May 9, 2024 to April 30, 2025 with the maximum total value of JPY100 billion. All the shares repurchased will be retired.
• As of October 31, 2024, a cumulative total of 14,220,100 shares were repurchased at a total value of approx. JPY68.3 billion.

©NYK Group. All rights reserved.

3

1. Overview of the Q2 Results for FY2024

Results

Recurring profit by segment (year-on-year comparison)

Liner Trade: JPY176.6 billion (up JPY129.9 billion)

• The profit level of Container Shipping significantly increased year on year due to freight rates being higher than in the same period last year resulting from the continued tight supply-demand conditions caused by robust cargo movements and the situation in the Red Sea.

Air Cargo Transportation: JPY8.3 billion (up JPY8.0 billion)

• Cargo volumes, mainly from Asia to Europe and the U.S., remained strong, resulting in an increase in handling volumes. Freight rates also increased year on year due to tight supply and demand.

Logistics: JPY12.4 billion (down JPY1.3 billion)

• Air freight & Ocean freight: Although the handling volumes increased year on year driven mainly by cargo from Asia, purchase prices rose caused by the change in market conditions. Profit levels of air freight declined year on year, while those of ocean fright were flat year on year.
• Contract logistics: The business secured a certain level of profits despite a slowdown in cargo movements in Europe and East Asia, which was offset by a solid revenue in the other regions including North America.

©NYK Group. All rights reserved.

4

1. Overview of the Q2 Results for FY2024

Results

Recurring profit by segment (year-on-year comparison)

Automotive: JPY61.6 billion (up JPY1.0 billion)

• Although impacted by the port congestion, the conflict in the Middle East, and a rise in cargo handling costs, the Automotive Business maintained the number of vehicles transported and the profit level year on year by optimizing the vessel deployment plans and vessel operations.

Dry Bulk: JPY8.5 billion (down JPY12.0 billion)

• Although market levels improved year on year for all vessel segments, the Dry Bulk Business saw the profit level decrease due to a decline in freight rates and total volume of multi-purpose carrier cargo compared with the previous fiscal year, as well as the impact of foreign exchange.

Energy: JPY21.8 billion (down JPY0.1 billion)

• VLCC: Although market levels improved year on year, vessel utilization declined due to the increased number of vessels docked.
• VLGC: Although market levels declined year on year due to an easing of supply- and-demand conditions following the completion of new vessels, stable revenue was secured as the contract was successfully renewed at the charterage fee reflecting the high market conditions in the previous fiscal year.
• LNG carrier: The results remained steady, supported by medium- to long-term contracts.

©NYK Group. All rights reserved.

5

Summary of Q2 Results

Q2 Results

					FY2023							FY2024			Year-on-
															year
	of yen)	Q1	Q2	1H	Q3	Q4	2H	Full-Year			Q1	Q2	1H
	nues	567.5	600.8	1,168.3	620.8	598.0	1,218.9	2,387.2	651.7	665.1	1,316.8	148.4
	Operating	47.1	51.6	98.7	45.4	30.4	75.8	174.6	65.8	49.7	115.6	16.8
	Profit
	Recurring	89.4	69.8	159.2	40.9	61.0	102.0	261.3	125.7	163.4	289.2	129.9
	Profit
	Profit	73.4	39.8	113.3	40.1	75.0	115.2	228.6	110.2	155.6	265.8	152.5
	attributable to owners
	of parent
	ge Rate	¥135.81	¥144.05	¥139.93	¥148.72	¥146.68	¥147.70	¥143.82		¥155.02	¥152.77	¥153.89		¥13.96
	Oil Prices	$611.22	$597.59	$604.38	$642.12	$629.90	$636.07	$620.83	$634.08	$629.71	$631.85	$27.47

©NYK Group. All rights reserved.

6

Q2 Comparison by Segment

Q2 Results

Note 1

Note 2

				Operating				FY2023							FY2024				Year-
				Segment
																		on-year
				(Billions of yen)	Q1	Q2	1H	Q3	Q4	2H	Full-Year			Q1	Q2	1H
	Liner &			Liner Trade	56.4	55.2	111.7	41.3	39.3	80.6	192.3		44.5	47.6	92.2		-19.5
			31.6	15.0	46.7	-1.3	22.5	21.1	67.8			53.7	122.9	176.6		129.9
			Air Cargo	37.0	40.8	77.8	44.8	38.4	83.3	161.1			46.6	46.0	92.6		14.7
	Logistics			Transportation	0.4		0.3	4.9	0.4	5.4	5.7			3.4	4.80	8.3		8.0
			-0.0
			Logistics	164.7	173.9	338.6	181.6	181.9	363.6	702.2			189.0	212.2	401.2		62.5
			7.0	6.7	13.7	7.3	4.8	12.2	25.9		5.5	6.8	12.4		-1.3
	Automotive	114.1	129.3	243.4	131.2	116.1	247.4	490.9	138.3	133.3	271.6	28.1
	29.5	30.9	60.5	27.4	17.8	45.3	105.8	37.8	23.7	61.6	1.0
	Dry Bulk	134.7	136.1	270.8	152.6	149.7	302.4	573.3		163.2	160.1	323.4		52.5
	12.9	7.6	20.5	-4.2	1.7	-2.5	18.0		14.0	-5.5	8.5		-12.0
	Energy	40.6	40.8	81.4	46.9	45.0	91.9	173.3	46.6	44.3	91.0	9.5
	11.2	10.7	22.0	11.1	13.2	24.3	46.3		11.0	10.7	21.8		-0.1
	Others		48.2	60.1	108.3	57.4	56.9	114.3	222.6	54.4	48.9	103.4	-4.9
		-0.4	1.3	0.9	-0.1	2.8	2.6	3.6		1.7	2.5	4.2		3.3
	Elimination/	-28.4	-35.6	-64.0	-35.1	-29.6	-64.8	-128.8	-31.1	-27.6	-58.8	5.2
	Corporate	-3.0	-2.5	-5.5	-4.0	-2.5	-6.6	-12.1		-1.7	-2.6	-4.4		1.0
	Consolidated	567.5	600.8	1,168.3	620.8	598.0	1,218.9	2,387.2	651.7	665.1	1316.8	148.4
	89.4	69.8	159.2	40.9	61.0	102.0	261.3	125.7	163.4	289.2	129.9

(Upper) Revenues (Lower) Recurring Profit

Note 1 Effective from FY2024, the previous Bulk Shipping Business has been divided into Automotive Business, Dry Bulk Business, and Energy Business.

Note 2 Effective from FY2024, Real Estate Business has been included in Other Businesses.

(To reflect the above changes, the figures for FY2023 has been reclassified to conform to the new classification.)

©NYK Group. All rights reserved.

7

Analysis of Change in Recurring Profit	Q2 Results
between FY2023 and FY2024

Analysis by factor

	（	）
		billion yen
Yen		19.7	153.89/$
Depreciation		Depreciated by ¥13.96
Higher		-0.6	$631.85/MT
Bunker Oil
	Increased by $27.47/MT
Prices
			Liner (incl. ONE) +122.9
Market	111.2	Automotive
Effects, etc.	Dry Bulk	-11.7
			Energy
Foreign		-10.1
Exchange
Gains/Losses
Others		9.7	Logistics -1.3
	Air Cargo(NCA) +8.0
Total	129.9

Analysis by business

P/L Increase

P/L Decrease

0

Results

8

2. Full-year Forecast for FY2024

Forecast

Full-yearforecast (Comparison with the forecast announced at the previous financial reporting)

Revenues: JPY2,540.0 billion (down JPY30.0 billion)

• Automotive: Down JPY23.0 billion

Recurring profit: JPY410.0 billion yen (unchanged)

• Liner Trade: Up JPY22.0 billion
• Dry Bulk/Automotive: Down JPY13.0 billion/JPY10.0 billion, respectively

Net income: JPY390.0 billion (unchanged)

Shareholder return:

Dividend (per share): Interim: 130 yen | Year-end: 130 yen (forecast) (Annual: 260 yen) (unchanged)

• The annual amount of dividends has been determined in line with a targeted consolidated payout ratio of 30% as set forth in the basic shareholder return policy.
• The amounts of forecast dividends are based on the number of shares excluding the number of shares of treasury stock acquired by the end of October 2024.

Share repurchase

• For the share repurchase program currently underway (see page 3), we have determined to increase the maximum total value of shares to be repurchased by JPY30.0 billion from JPY100.0 billion to JPY130.0 billion.
• There are no other changes in details including the repurchase period (May 9, 2024-April 30, 2025).

©NYK Group. All rights reserved.

9

2. Full-year Forecast for FY2024

Forecast

Recurring profit by segment (Comparison with the forecast announced at the previous financial reporting)

Liner Trade: JPY205.0 billion (up JPY22.0 billion)

• In Container Shipping, although we expect that the tight supply-demand balance will ease after peaking out in the second quarter and short-term freight rates will decline toward the end of the current fiscal year, the full-year profit level will be higher than our previous forecast as the second-quarter profit level has ended up being higher than our previous forecast.

Air Cargo Transportation: JPY13.0 billion (up JPY3.0 billion)

• From the third quarter onward, we expect steady cargo demand mainly from Asia to Europe and the U.S.
• The full-year earnings forecast has been developed assuming that, as disclosed on June 10, 2024, the share exchange of Nippon Cargo Airlines Co, Ltd. (NCA) will be executed on March 31, 2025.

Logistics: JPY22.0 billion (unchanged)

• Air freight: Although the handling volumes are expected to be steady, the profit level is expected to be lower than our previous forecast due to a rise in purchase prices .
• Ocean freight: Although the container shipping market is in a downward trend, the profit level is expected to be slightly higher than as our previous forecast due in part to winning the business of handling high unit-price cargo.
• Contract logistics: Despite a slowdown in cargo movements in Europe and East Asia, the business will be backed by a solid performance of the business in North America.

©NYK Group. All rights reserved.

10