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MOL CEO Ikeda’s 2019 New Year Message

BSN Network / Mumbai
Date: 10/01/2019

In the early Heisei years, the marine shipping industry faced a persistently challenging business environment even as Japan’s economy was buoyed by an asset bubble. In the 2000s, economic growth in China and burgeoning global trade flows led to surging market conditions in the marine shipping industry, setting the stage for a boom in marine transport. In 2007, MOL delivered ordinary profit of ¥300.0 billion. Thereafter, the boom subsided. MOL was buffeted by the rough and tumble currents of the global financial crisis and market volatility. In response, MOL was compelled at times to implement dramatic business structural reforms. Today, MOL must still navigate challenging conditions. In the past few years, we have overcome many periods of major upheaval in the business environment. Even in these tumultuous times, MOL has managed to achieve transformation and growth. Over the past 30 years, the MOL Group’s shipping and other revenues increased from ¥480.0 billion in 1989, the start of the Heisei period, to ¥1,650.0 billion.

Ocean Network Express (ONE), our integrated containership business venture with two other major Japanese shipping companies, started operations in April 2018. Unfortunately, the new business venture set sail in choppier waters than we had expected, as it did not reach its projected liftings due to disruptions in initial operations. However, the cost savings derived from integrating the containership operations have surpassed estimates before the integration. We also know exactly what must be done to improve cargo volume liftings and earnings. We will closely heed the lessons we have learned from ONE’s results to date as we fulfill our governance responsibilities as an investing company of this business venture. In the process, I will redouble my commitment to ONE and provide any support necessary to ensure the venture’s success.

 

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