In the crude oil tanker market, conditions remained firm in the first half of the fiscal year, as in the previous fiscal year. From September onwards, the vessel supply-demand balance tightened due to an increase in cargo volumes following the unwinding of voluntary production cuts by OPEC+ nations, and market conditions remained at high levels.

In the product tanker market, conditions remained firm, underpinned by the strengthening of Middle East tensions and Russia-related sanctions, which supported market conditions for large vessels.

In the LPG carrier market, U.S. Trade Representative (USTR) port fee measures and U.S.-China tariff issues complicated trade patterns, resulting in increased ton-miles in terms of both sailing distance and transport volume, tightening the vessel supply-demand balance. Market conditions were maintained even after the further deterioration of the situation in the Middle East, including the de facto closure of the Strait of Hormuz.

In the chemical tanker market, market conditions softened due to the backdrop of global economic uncertainty stemming from U.S. high tariff policies and Middle East tensions. Additionally, an expense was recorded due to the lump-sum amortization of goodwill at an equity-method affiliate in the tank container business, resulting in a decrease in profit compared to the previous fiscal year.

Accordingly, the Tanker Business recorded a decrease in profit compared to the previous fiscal year.

The FPSO business recorded stable profit from existing long-term charter contracts. Profit decreased compared to the previous fiscal year due to the absence of equity in earnings of affiliated companies resulting from the revaluation of shares in MODEC, Inc. upon its transition to an equity-method affiliate, which had been recorded in the previous consolidated fiscal year.

The LNG and Ethane Carrier business secured stable profit through existing long-term charter contracts. However, a one-time expense was recorded due to financing matters at an equity-method affiliate, resulting in a decrease in profit compared to the previous fiscal year.

The Gas Infrastructure business recorded a decrease in profit compared to the previous fiscal year, partly due to a decline in operational efficiency caused by equipment malfunctions at certain projects.

(B)Product Transport Business

In the containership business, although seasonal factors provided some support for cargo demand, downward pressure on freight market rates continued against the backdrop of expanding vessel supply capacity from new vessel completions. As a result, OCEAN NETWORK EXPRESS PTE. LTD., an equity-method affiliate, recorded a decrease in profit compared to the previous fiscal year.

Although demand for completed build-up vehicle transport continued to be firm, vessel deployment efficiency was constrained by port congestion and the impact of Middle East tensions. In addition, cost increases due to inflation and the impact of exchange rate fluctuations resulted in a decrease in profit compared to the previous fiscal year.

In the terminal business, handling volumes at domestic container terminal operations remained broadly firm. Regarding overseas terminal operations, the handling volume at the Vietnam terminal, in which the Company has an equity stake, continued to be firm due to a shift in production locations driven by U.S. high tariff policies.

In the logistics business, while overall air cargo volumes increased, profit decreased compared to the previous fiscal year due to a slowdown in cargo movements from East Asia to the United States as a result of the impact of U.S. high tariff policies. In the tank terminal business of LBC Tank Terminals Group Holding Netherlands Co peratief U.A. (hereinafter “LBC”), stable revenues were recorded under long-term contracts, while one-time costs associated with the acquisition of LBC’s shares and goodwill amortization were incurred.

(C)Wellbeing & Lifestyle Business

DAIBIRU CORPORATION, the core of the Group’s real estate business, recorded firm profit from its existing portfolio of office and commercial buildings. Although newly acquired properties (135 King Street in Australia and Capital House in the United Kingdom) made positive profit contributions, profit decreased compared to the previous fiscal year due to the impact of redevelopment of certain properties and the absence of one-time equity-method investment income that had been recorded in the previous consolidated fiscal year.

At MOL Sunflower Ltd., although cargo volumes decreased due to a reduction in the number of sailings and sluggish cargo conditions, this was offset by strong passenger business performance centered on the Kansai routes and freight rate revisions, resulting in an increase in profit compared to the previous fiscal year.

In the cruise business, profit decreased compared to the previous fiscal year due to the idle period and maintenance of MITSUI OCEAN FUJI, as well as the time required for demand creation.

(D)Associated Businesses
The Tugboat business recorded an increase in profit compared to the previous fiscal year, as the number of operations increased.

(E)Others
Other businesses, including ship operation, ship management, and financing, recorded a decrease in profit compared to the previous fiscal year.

Effective from the next fiscal year ending March 2027, the “Chemical Logistics Business” is newly established as a new reporting segment. The product tanker and chemical tanker, previously included in the “Energy Business,” are transferred, along with the tank terminal business previously included in the “Product Transport Business,” to the “Chemical Logistics Business.”

The following outlooks by segment are formulated based on the assumption that navigation in the Persian Gulf will not normalize until around July 2026, and navigation through the Red Sea will remain unavailable until the end of March 2027.

(A)Dry Bulk Business
For Capesize bulkers, firm cargo movements of iron ore and bauxite are expected, and new vessel completions in fiscal year 2026 are projected to remain limited, resulting in a continuation of tight vessel supply-demand conditions and consequently firm market conditions.

For Panamax and smaller bulkers, market conditions are expected to remain firm, supported by solid cargo movements of grain, coal, and wood chips.

In the Open-hatch vessel business, transport demand for the main cargoes of pulp and project cargo is expected to remain firm.
Accordingly, the Dry Bulk Business is expected to increase in profit compared to the previous fiscal year.

(B)Energy Business
In the crude oil tanker market, disruptions to trade patterns due to Middle East tensions are expected to persist. Even if tensions ease, it is anticipated that a certain amount of time is required for trade patterns to normalize. Accordingly, the tightening of the vessel supply-demand balance is expected to continue, and market conditions are expected to remain firm.

In the LPG carrier market, under the current Middle East tensions, alternative cargoes are expected to come predominantly from North American loadings, continuing to extend ton-miles and supporting firm market conditions. Even if Middle East tensions ease, it is anticipated that a certain amount of time will be required for the normalization of Middle East cargo supply. However, as the pressure from new vessel supply is expected to intensify from the second half of fiscal year 2026, market conditions are expected to gradually adjust.

The Offshore business is expected to continue securing stable profit from existing long-term charter contracts.

The LNG and Ethane Carrier business is expected to continue securing stable earnings.

The Gas Infrastructure business expects a decrease in profit due to the impact of operational conditions on certain projects.

(C)Chemical Logistics Business
In the product tanker market, regional disparities in market conditions have widened due to the impact of the closure of the Strait of Hormuz. In the Far East, which is the main operating region, cargo movements have slowed and market conditions are on a softening trend; however, stable earnings secured through medium-term contracts are expected to provide a floor, and the segment expects higher profit. In the methanol carrier business, steady performance is expected, underpinned by a business structure centered on medium- to long-term contracts. In the chemical tanker business, downward pressure on earnings is expected primarily in the first half of fiscal year 2026 due to route restrictions arising from the situation in the Middle East and the impact of rising fuel costs, and profit is expected to decline for the full year; however, market conditions are expected to stabilize toward the second half, and the impact on earnings is expected to be limited.

In the Tank Terminal Business, while costs including goodwill amortization associated with the acquisition of LBC shares will continue, the Company’s performance is expected to remain stable, supported by existing long-term contracts and the commissioning of new tanks.

(D)Product Transport Business
In the containership business, continued increases in vessel supply from new vessel completions and rising fuel costs against the backdrop of Middle East tensions are anticipated. However, through route restructuring and agile vessel deployment, a certain level of profit will be secured for the full fiscal year 2026.

In the vehicle transport business, a partial decrease in profit is expected due to the impact of the closure of the Strait of Hormuz on vessel deployment to the Persian Gulf and rising fuel costs. The Company will closely monitor global political and economic conditions affecting automobile sales and completed build-up vehicle transport. It will achieve efficient operations through agile vessel deployment.

In the terminal business, handling volumes at domestic container terminal operations are expected to remain firm. Regarding overseas container terminal operations, the Company plans to continue proceeding with the transfer of shares in remaining terminal companies.

A partial decrease in profit is expected due to rising fuel costs and increased costs resulting from the impact of Middle East tensions.

In the logistics business, while changes in customer needs resulting from external factors such as Middle East tensions and fluctuations in procurement costs are anticipated, the Company will work to improve its financial results through agile sales and procurement activities.

Accordingly, the Product Transport Business expects a decrease in profit compared to the previous fiscal year.

(E)Wellbeing & Lifestyle Business
In the real estate business, DAIBIRU CORPORATION, the core of the Company’s real estate business, is expected to record a significant increase in profit compared to the previous fiscal year, driven by firm profit from its existing portfolio of office and commercial buildings, profit contributions from newly acquired properties (Capital House in the United Kingdom and Warwick Court in the United Kingdom), the completion of Atrium Place in India, and capital gain investment returns in Japan and overseas.

In the ferry and domestic RoRo ship business, stable profit is expected to continue to be secured, supported by demand for logistics arising from the strengthening of truck driver labor regulations and firm domestic passenger demand. While a temporary impact on profit and loss is anticipated due to rising fuel unit costs resulting from Middle East tensions, the impact on full-year performance is expected to be limited.

In the cruise business, strong booking accumulation is expected for both MITSUI OCEAN FUJI and MITSUI OCEAN SAKURA, which is scheduled to start its service in September 2026. However, profit is expected to temporarily deteriorate due to a period of single vessel operations between the retirement of Nippon Maru and the entry into service of MITSUI OCEAN SAKURA.
Accordingly, the Wellbeing & Lifestyle Business is expected to record an increase in profit compared to the previous fiscal year.

(F)Associated Businesses
Associated businesses, including the Tugboat business and the trading businesses, are expected to record a decrease in profit due to a reduction in towage operations resulting from a decrease in port calls for certain vessel types against the backdrop of Middle East tensions, as well as rising fuel costs.

5.Financial Position
Total assets as of March 31, 2026 increased by 977.7 billion compared to the balance as of the end of the previous fiscal year, to 5,962.2 billion. This was primarily due to the increase in Buildings and structures.

Total liabilities as of March 31, 2026 increased by 772.9 billion compared to the balance as of the end of the previous fiscal year, to 3,033.1 billion. This was primarily due to the increase in Long-term bank loans.

Total net assets as of March 31, 2026 increased by 204.8 billion compared to the balance as of the end of the previous fiscal year, to 2,929.0 billion. This was primarily due to the increase in Retained earnings.

As a result, shareholders equity ratio decreased by 5.7 percentage points compared to the ratio as of the end of the previous fiscal year, to 48.2%.

6.Cash Flow
Cash and cash equivalents (hereinafter called cash ) as of the end of FY2025 was 201.4 billion, an increase of
45.5 billion compared to the balance as of the end of the previous fiscal year. Cash flows on each activity are as follows.

Net cash provided by operating activities during FY2025 was 450.9 billion (while net cash provided by FY2024 was 360.4 billion), mainly due to Profit (loss) before income taxes growing to 239.0 billion.

Net cash used in investing activities during FY2025 was 721.5 billion (while net cash used in FY2024 was 450.8 billion), mainly due to Purchase of shares of subsidiaries resulting in change in scope of consolidation.

Net cash provided in financing activities during FY2025 was 312.9 billion (while net cash used in FY2024 was 117.0 billion), mainly due to Proceeds from long-term bank loans.

Full Report

Source: Mitsui O.S.K. Lines