9025 Konoike Transport Co., Ltd.
November 2025
Q&A Highlights, Financial Results Briefing for the 2nd Quarter of Fiscal Year Ending March 2026
This Q&A session is a summary of the main questions asked by attendees at the analyst and institutional investor meetings. Certain sections have been edited to facilitate understanding.
■Second-Half Financial Results
Q1) Your latest forecast for operating income in the second half has decreased compared to the forecast at the beginning of the fiscal year. What are your thoughts on performance for the second half of the fiscal year?
A1) While we expect the Steel Business in India to contribute as in the first half of the fiscal year, the number of flights handled by the Airport-Related Business will likely decline, and we expect delays in the arrival of foreign personnel, as well as further increases in recruiting and training costs. The combination of these factors will likely lead to lower profit than initially forecast. In addition, International Logistics at BEL and PVP was impacted negatively by tariffs in the first half, with the impact being covered by performance in the U.S. and ASEAN. We do not expect to see this coverage in the second half due to stagnant cargo movement, and we expect profits to decline overall. We also expect an increase in SG&A expenses, including systems costs and consulting fees related to lease accounting, which will also contribute to an overall decrease in profits. At the same time, we hope to build revenues by acquiring spot business, so our aim is for a level similar to the forecast at the beginning of the fiscal year.
Business in India
Q2) It appears that the transaction volume in the Indian rail business has decreased compared to initial forecast.
A2) First, we saw a trend in the container train operator (CTO) business toward a wait-and-see attitude for exports stemming from the U.S. tariff policy. It also took some time to finalize the nine new trains introduced last year, so cargo volume did not meet initial plan. In addition, the automobile freight train operator (AFTO) business was impacted negatively by the extra time taken in the periodic inspections of two of our trains. Compared to last year, however, the use of used trains had a definitive impact. Another positive factor going forward will be the completion of construction for a double-stack freight rail line, which will increase transport capacity.
■Airport-Related
Q3) What impact do you envision related to the Chinese government's call for voluntary travel restraints among its citizens?
A3) While I cannot provide a specific number related to the impact at this time, I can provide an explanation regarding volume related to flights from China and our Airport-Related Business.
About 25% of the flights we handle at the three major airports (Kansai International Airport, Narita International Airport, and Haneda International Airport) are Chinese routes. Based on first-half sales of ¥15.5 billion, we can say the amount related to China is equivalent to approximately ¥4 billion per half, or ¥8 billion annually. Based on news reports and other information, we expect the reduction in flights to occur in December or later. Accordingly, we estimate approximately ¥2.5 billion of sales over a four-month period could be affected this fiscal year. At the same time, we believe it is unlikely that there will be zero traffic between Japan and China. Since our consignment contracts are primarily on a per-flight basis, the impact will likely fluctuate depending on downsizing by the airlines and flight cancellations. In addition, the composition of flights to and from China handled by Konoike is approximately 80% full-service carriers (FSC), with the remainder being low-cost carriers (LCC). Our outlook will be influenced by which incurs the heavier impact. As you can see, providing specifics as to the impact in monetary terms is difficult at this time.
■Medium-Term Business Plan
Q4) In light of the impact of the U.S. tariff policy on PVP and BEL, as well as the possibility of reduced flights to and from China in the Airport-Related Business, etc., have you made any changes in your thinking regarding the priority policies of the current medium-term business plan ? In addition, have you made any changes to the final year targets of the medium-term business plan for the Overseas Business (net sales of ¥78 billion and operating income of ¥3.3 billion)?
A4) To get straight to the point, we have made no changes to the current medium-term business plan, and we expect to leave the net sales and operating income targets for the final year unchanged. With respect to BEL, the company has decided to withdraw from the master loader business (air cargo space sales), which was the main cause of losses. We also expect the scale of the BEL business to contract. At the same time, while tariffs have had an impact on PVP performance, we have already secured contracts with several companies, and we will continue to invest strategically in this business, which we expect will grow in the future. We have conducted our Airport-Related Business in consideration of various event risks in the past. We experienced overcoming tough times through flexible staffing during the COVID pandemic. As we assume the likelihood of these risks, our policy is to grow domestically and internationally over the long term.