Kawasaki Kisen Kaisha, Ltd. · TSE:9107
Kawasaki Kisen Kaisha — Investor Presentation (June 2024)
63 slides from Kawasaki Kisen Kaisha's investor presentation, Jun 3, 2024
Slide 1: Business Briefing
Business Briefing June 3rd, 2024
Slide 2: Agenda
AGENDA Opening Remarks Car Carrier Business Coal & Iron Ore Carrier Business LNG Carrier Business Projects for emission reduction and decarbonization Closing Remarks 1
Slide 3: Today's Objective
Opening Remarks Todayʼs Objective The theme of todayʼs business briefing on our earnings plans and growth strategy to FY2030 is “Further Growth” for the medium-term improvement of shareholder value May 2023 Business Briefing Todayʼs Business Briefing “Stability & Growth Potential” “Stability & Furth
Slide 4: Earnings Targets
Opening Remarks Earnings Targets In 2030, we aim to generate 110.0 billion yen + α in ordinary income from “K” Lineʼs own businesses To achieve our earnings targets, we will take measures to enhance the profitability of three core businesses driving growth as well as our new business areas Ordinary
Slide 5: M&A Strategy
Opening Remarks M&A Strategy In business areas where we can leverage “K” Lineʼs strengths, we continuously review strategies to promote discontinuous growth Requirements for Target Area Target Companies Return Target • Business areas where • Highly competitive on a • Without relaxing our we can leve
Slide 6: Business Briefing Agenda
Opening Remarks Business Briefing Agenda Topics Presenter Opening Remarks President & CEO Yukikazu Myochin Senior Managing Executive Officer Car Carrier Business Takenori Igarashi Managing Executive Officer Coal & Iron Ore Carrier Business Masatoshi Taguchi Managing Executive Officer LNG Carrier Bus
Slide 7: Agenda
AGENDA Opening Remarks Car Carrier Business Coal & Iron Ore Carrier Business LNG Carrier Business Projects for emission reduction and decarbonization Closing Remarks 6
Slide 8: Index
Index 1. 2. 3. 4. 5. Business Medium-term Business Earnings Plan Investment Characteristics Management Strategy Plan and Market Plan Targets Trends and Progress 7
Slide 9: Transport Demand Outlook and Business Characteristics
1. Business Characteristics and Market Trends Transport Demand Outlook and 1. Business Characteristics and 2. Medium-term Management Plan 3. Business 4. Earnings Plan 5.Investment Business Characteristics Market Trends Targets and Progress Strategy Plan Car Carrier Business is supported by solid dem
Slide 10: Vessel Supply Outlook
1. Business Characteristics and Market Trends Vessel Supply Outlook 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan Supply is expected to increase until 2026 to resolve the tight supply and dema
Slide 11: Supply and Demand Balance Outlook
1. Business Characteristics and Market Trends Supply and Demand Balance 1. Business Characteristics and 2. Medium-term Management Plan 3. Business Strategy 4. Earnings Plan 5.Investment Plan Outlook Market Trends Targets and Progress Supply shortages will continue until 2025. It is predicted that su
Slide 12: Progress in Strengthening Profitability and Investment Plan
2. Medium-term Management Plan Targets and Progress Progress in Strengthening Profitability 1. Business Characteristics and 2. Medium-term Management Plan 3. Business 4. Earnings Plan 5.Investment and Investment Plan Market Trends Targets and Progress Strategy Plan Profit improvement measures such a
Slide 13: Progress in Fleet Development
2. Medium-term Management Plan Targets and Progress Progress in Fleet Development 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan Business strategy has been progressing steadily by promoting “Ro
Slide 14: What is Competitiveness of Eco-Friendly Vessels
3. Business Strategy What is Competitiveness of 1. Business Characteristics and 2. Medium-term Management Plan 3. Business Strategy 4. Earnings Plan 5.Investment Plan Eco-Friendly Vessels Market Trends Targets and Progress From the second half of the 2020s, the decarbonization value of environmental
Slide 15: Summary of Initiatives towards FY30
3. Business Strategy Summary of Initiatives towards FY30 1. Business Characteristics and 2. Medium-term Management Plan 3. Business Strategy 4. Earnings Plan 5.Investment Plan Market Trends Targets and Progress In order to accelerate our growth under the “Route-Fleet-Customer” balanced strategy, we
Slide 16: Future Earnings Outlook
4. Earnings Plan Future Earnings Outlook 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan Looking ahead to FY2030, we aim to strengthen sustainable profitability through measures such as "introdu
Slide 17: Future Investment Outlook
5. Investment Plan Future Investment Outlook 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan In the long term, we will promote fleet development in line with the needs of our core customers, inc
Slide 18: Key Points of Briefing
Key Points of Briefing Demand and supply︓Demand for marine transportation remains steady. Supply shortages will continue until 2025. Supply and demand will balance and stabilize from around 2026, but trends in mass retirement and replacement new construction from 2030 to 2035 will be closely monitor
Slide 19: Agenda
AGENDA Opening Remarks Car Carrier Business Coal & Iron Ore Carrier Business LNG Carrier Business Projects for emission reduction and decarbonization Closing Remarks 18
Slide 20: Index
Index 1. 2. 3. 4. 5. Business Medium-term Business Earnings Plan Investment Characteristics Management Strategy Plan and Market Plan Targets Trends and Progress 19
Slide 21: Characteristics of Coal & Iron Ore Carrier Business
1. Business Characteristics and Market Trends Characteristics of Coal & Iron Ore 1. Business Characteristics and 2. Medium-term Management Plan 3. Business Strategy 4. Earnings Plan 5.Investment Plan Carrier Business Market Trends Targets and Progress Coal & Iron Ore Carrier business has significant
Slide 22: Market Trends
1. Business Characteristics and Market Trends Market Trends 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan Demand from our main customers forecast to increase. Demand from Japanese and Korean s
Slide 23: Business Strategy Progress
2. Medium-term Management Plan Targets and Progress Business Strategy Progress 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan Steady progress in business strategy i.e. maintaining and expanding
Slide 24: Earnings Plan Progress
2. Medium-term Management Plan Targets and Progress Earnings Plan Progress 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan FY24 results are forecast to rebound from FY23, when such performance f
Slide 25: Investment Plan and Progress
2. Medium-term Management Plan Targets and Progress Investment Plan and Progress 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan Overall industry demand for eco-friendly vessels is slower than f
Slide 26: Business Strategy Overview
3. Business Strategy Business Strategy Overview 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan Aim to realize earnings potential by expanding base scenario earnings with Japanese and Korean ste
Slide 27: Base Scenario Expansion: Customer Strategy
3. Business Strategy Base Scenario Expansion: 1. Business Characteristics and 2. Medium-term Management Plan 3. Business 4. Earnings Plan 5.Investment Customer Strategy Market Trends Targets and Progress Strategy Plan Going forward, we aim to deepen our customer-oriented organizational sales, levera
Slide 28: Base Scenario Expansion: Business Strategy
3. Business Strategy Base Scenario Expansion: 1. Business Characteristics and 2. Medium-term Management Plan 3. Business Strategy 4. Earnings Plan 5.Investment Plan Business Strategy Market Trends Targets and Progress In order to continue to be chosen as a partner for customers' challenges, includin
Slide 29: Realizing Earnings Potential
3. Business Strategy Realizing Earnings Potential 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan Further expand earnings by taking measures to secure new transport demand amid existing customer
Slide 30: Earnings Plan
4. Earnings Plan Earnings Plan 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan Towards FY2030, achieve steady earnings growth by taking measures to increase and stabilize earnings, while expandi
Slide 31: Investment Plan
5. Investment Plan Investment Plan 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan In order to improve competitiveness and expand the scale of fleet operations, we will invest in owned vessels,
Slide 32: Key Points of Briefing
Key Points of Briefing Demand from our main customers forecast to increase. Demand from Japanese and Korean steel mills forecast to be flat, while business opportunities with Indian and Middle East mills and major resources companies are expected to grow Regarding current business results, earnings
Slide 33: Agenda
AGENDA Opening Remarks Car Carrier Business Coal & Iron Ore Carrier Business LNG Carrier Business Projects for emission reduction and decarbonization Closing Remarks 32
Slide 34: Index
Index 1. 2. 3. 4. 5. Business Medium-term Business Earnings Plan Investment Characteristics Management Strategy Plan and Market Plan Targets Trends and Progress 33
Slide 35: Strategic Category of LNG Carrier Business
1. Business Characteristics and Market Trends Strategic Category of LNG 1. Business Characteristics and 2. Medium-term Management Plan 3. Business Strategy 4. Earnings Plan 5.Investment Plan Carrier Business Market Trends Targets and Progress "K" Line pursues a “long-term stable” strategy leveraging
Slide 36: LNG Demand Outlook
1. Business Characteristics and Market Trends LNG Demand Outlook 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan LNG demand is expected to remain solid over the long term, supported by its accep
Slide 37: Business Strategy Progress
2. Medium-term Management Plan Targets and Progress Business Strategy Progress 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan We have successfully increased the number of long-term stable earni
Slide 38: Plan Progress (Earnings, Investment)
2. Medium-term Management Plan Targets and Progress Plan Progress 1. Business Characteristics and 2. Medium-term Management Plan 3. Business Strategy 4. Earnings Plan 5.Investment Plan (Earnings, Investment) Market Trends Targets and Progress FY23 earnings made solid progress towards targets under M
Slide 39: Business Strategy
3. Business Strategy Business Strategy 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan Towards FY30, strive to accumulate exiting customersʼ business projects and develop new customers Aim to ex
Slide 40: Strengthen Structure to Expand Number of Vessels in Fleet
3. Business Strategy Strengthen Structure to Expand 1. Business Characteristics and 2. Medium-term Management Plan 3. Business Strategy 4. Earnings Plan 5.Investment Plan Number of Vessels in Fleet Market Trends Targets and Progress Continue to enhance "K" Lineʼs strength of customer support that co
Slide 41: KPI to Measure Business Plan Results
3. Business Strategy KPI to Measure Business 1. Business Characteristics and 2. Medium-term Management Plan 3. Business Strategy 4. Earnings Plan 5.Investment Plan Plan Results Market Trends Targets and Progress To manage business plan progress, five KPIs measure results across the three phases of “
Slide 42: Earnings Plan
4. Earnings Plan Earnings Plan 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan By FY30, we plan to secure contracts and expand earnings at a speed faster than the market growth through efforts t
Slide 43: Investment Plan
5. Investment Plan Investment Plan 1. Business Characteristics and Market Trends 2. Medium-term Management Plan Targets and Progress 3. Business Strategy 4. Earnings Plan 5.Investment Plan Total investment of 250.0 billion yen planned during the Medium-term Management Plan, with approx. 60% currentl
Slide 44: Key Points of Briefing
Key Points of Briefing We have positioned LNG Carriers business as a growth business amid the overall market expansion, along LNG demand steadily increases and long-term stable LNG transport demand is forecast to increase firmly until 2040 Using our market-leading ship management track record and ab
Slide 45: Agenda
AGENDA Opening Remarks Car Carrier Business Coal & Iron Ore Carrier Business LNG Carrier Business Projects for emission reduction and decarbonization Closing Remarks 44
Slide 46: Overview of Projects for Emission Reduction and Decarbonization
Projects for Emission Reduction and Decarbonization Overview of Projects for Emission Reduction and Decarbonization We are taking initiatives in the four new business areas of liquified CO2 transport business, LNG carrier-related business, offshore wind turbine support vessels, and hydrogen and ammo
Slide 47: Overview of Projects for Emission Reduction and Decarbonization
Projects for Emission Reduction and Decarbonization Overview of Projects for Emission Reduction and Decarbonization In order to form a well-balanced new business portfolio, we are working on four projects for emission reduction and decarbonization simultaneously Liquified CO2 transport business LNG
Slide 48: Earnings Target for Entire Decarbonization Portfolio
Projects for Emission Reduction and Decarbonization Earnings Target for Entire Projects for Emission Reduction and Decarbonization Portfolio Aiming to establish a business structure to achieve earnings of 5.0 billion-10.0 billion yen in mid- 2030s for the entire projects for emission reduction and d
Slide 49: Liquified CO2 Transport Business Index
Liquified CO2 Transport Business Index 1. 2. 3. 4. 5. Business Market Trends Business Earnings Plan Investment Characteristics Strategy Plan 48
Slide 50: Social Importance of Liquified CO2 Transport Business
1. Business Characteristics Social Importance of 1. Business Characteristics 2. Market Trends 3. Business Strategy 4. Earnings Plan 5.Investment Plan Liquified CO2 Transport Business It is essential to pursue initiatives in both natural gas and CCS, which are considered realistic solutions to achiev
Slide 51: Importance of K Line Initiatives
1. Business Characteristics Importance of “K” Line 1. Business Characteristics 2. Market Trends 3. Business Strategy 4. Earnings Plan 5.Investment Plan Initiatives The importance of the liquified CO2 transport business for “K” Line is large. We can leverage our accumulated know-how, stable operation
Slide 52: Transport Method Categories
2. Market Trends Transport Method Categories 1. Business Characteristics 2. Market Trends 3. Business Strategy 4. Earnings Plan 5.Investment Plan There are three methods of transporting CO2 in CCS: maritime vessel, pipeline, and on-site injection. In FY2024, “K” Line will transport liquified CO2 for
Slide 53: Demand Outlook
2. Market Trends Demand Outlook 1. Business Characteristics 2. Market Trends 3. Business Strategy 4. Earnings Plan 5.Investment Plan By the mid-2030s, annual CO2 storage demand is forecast to be 2.0 billion metric tons, with approx. 10% of the total liquified CO2 requiring maritime transport, genera
Slide 54: Customer Strategy
3. Business Strategy Customer Strategy 1. Business Characteristics 2. Market Trends 3. Business Strategy 4. Earnings Plan 5.Investment Plan Many industries require liquified CO2 transport, from petroleum and steel to gas, electric power, paper and cement, and since many of our customers are in these
Slide 55: Regional Strategy: European Projects
3. Business Strategy Regional Strategy 1. Business Characteristics 2. Market Trends 3. Business Strategy 4. Earnings Plan 5.Investment Plan By 2030, we will participate in promising projects in Europe, a forerunner in introducing carbon emissions fees and implementation of subsidy policies for CCS,
Slide 56: Business Strategy
3. Business Strategy Business Strategy 1. Business Characteristics 2. Market Trends 3. Business Strategy 4. Earnings Plan 5.Investment Plan “K” Line aims to be recognized as the best partner for CCS projects, collaborating with customers from the project inception stage to go beyond liquified CO2 tr
Slide 57: Alliance Strategy
3. Business Strategy Alliance Strategy 1. Business Characteristics 2. Market Trends 3. Business Strategy 4. Earnings Plan 5.Investment Plan In March 2024, “K” Line and Nippon Gas Line announced joint-venture agreement. Aim to provide efficient maritime transport service for liquified CO2 integrating
Slide 58: Earnings Plan
4. Earnings Plan Earnings Plan 1. Business Characteristics 2. Market Trends 3. Business Strategy 4. Earnings Plan 5.Investment Plan Ordinary income target of 3.0~6.0 billion yen in mid-2030s. To meet ordinary income target, “K” Line will aim at a fleet of 20 or more vessels Ordinary income target fo
Slide 59: Investment Plan and Policies
5. Investment Plan Investment Plan and Policies 1. Business Characteristics 2. Market Trends 3. Business Strategy 4. Earnings Plan 5.Investment Plan By 2026, a total investment of approx. 90.0 billion yen into projects for emission reduction and decarbonization, with a policy of focusing on long-ter
Slide 60: Key Points of Briefing
Key Points of Briefing In order to contribute to societyʼs emission reduction and decarbonization, establish a business structure to achieve earnings of 5.0-10.0 billion yen by mid-2030s by working on four businesses for emission reduction and decarbonization LNG and CCS are essential to achieving n
Slide 61: Agenda
AGENDA Opening Remarks Car Carrier Business Coal & Iron Ore Carrier Business LNG Carrier Business Projects for emission reduction and decarbonization Closing Remarks 60
Slide 62: Closing Remarks: Key Points of Briefing
Closing Remarks Key Points of Briefing We aim to generate ordinary income of 110.0 billion yen + α 1 by 2030, the earnings target announced with the FY2023 financial report To achieve 110.0 billion yen in ordinary income, we will steadily promote our growth strategy for three core businesses driving
Slide 63: Disclaimer
【Disclaimer】 Information contained in this material is provided solely for informational purposes and is not an offer or a solicitation of an offer to buy or sell securities. You are requested to make investment decisions using your own judgment. 【Forward-looking statements】 This material contains f
Kawasaki Kisen Kaisha — Investor Presentation (June 2024) on 6ix