KAWASAKI KINKAI KISEN KAISHA,LTD. (E04269) Stock Price

Kawasaki Kinkai Steamship is a shipping company with its primary business in maritime transport throughout the Asia-Pacific region. The company provides international transport services using general cargo vessels in nearby coastal waters, as well as domestic transport services using coastal vessels and ferries within Japan. While its parent company, Kawasaki Kisen, handles long-distance ocean routes, this company specializes in relatively short-distance shipping routes.

The company's revenue is primarily generated from cargo transport of industrial raw materials such as coal, slag, cement, and wood chips. In the coastal segment, it handles cargo transport between Japan and Southeast Asian countries, Korea, and Russia. In the domestic coastal segment, it operates cargo transport between domestic ports and ferry services between Honshu and Hokkaido. Its main customers are heavy industry-related companies including steel manufacturers, electric power companies, and cement companies.

The company's business is divided into four segments: coastal shipping, domestic coastal shipping, OSV (Offshore Support Vessel), and other operations. The coastal segment handles transport of coal and biomass fuel, import transport of wood products, and export transport of steel materials. The domestic coastal segment consists of irregular domestic shipping, scheduled cargo vessels between Honshu and Hokkaido, and ferry transport between Hachinohe, Tomakomai, and Muroran. The OSV segment operates support vessel services for offshore oil and gas development.

Kawasaki Kinkai Shipping pursues stable profitability as its core management principle, strengthening its corporate foundation through complementary operations between its coastal and domestic shipping divisions. In addition to traditional shipping operations, the company is actively expanding into offshore support vessel (OSV) operations, a new business segment, to diversify its business portfolio. Amid reduced passenger ferry demand due to the COVID-19 pandemic, the company aims to improve financial performance through cost reduction via efficient vessel deployment based on customer needs and medium to long-term market trends.

In the coastal division, the company is advancing strategic fleet renewal to capitalize on recovering market conditions. For steel transport, it continues to secure advantageous cargo such as vehicles destined for Asia alongside conventional shipments, improving profitability on twin-deck vessel outbound voyages. In timber transport, the company is focusing on securing long-term contracts for biomass power generation fuel, including shipments from remote areas beyond the coastal region, to establish stable revenue sources. For bulk transport, the company aims to maintain market share in Russian coal transport, its core cargo, by maintaining and expanding its fleet to meet customer needs.

In the domestic division, the company promotes modal shift through reliable transportation services via RORO vessels and passenger ferries, working to develop maritime transport demand. On the Hachinohe-Tomakomai route, the company has deployed new vessels with significantly expanded private cabins, implementing COVID-19 measures while strengthening passenger and vehicle recruitment and developing cargo utilizing the new vessels' loading capacity. In scheduled shipping, amid declining bulk cargo such as paper products, the company is focusing on acquiring new cargo and reducing costs on the Hokkaido and Kyushu routes.

In the OSV division, the company pursues new growth opportunities aligned with Japan's energy strategy. The company continues proven CCS (carbon dioxide capture and subsea storage) survey work and government resource exploration support services, while aiming to actively participate in emerging offshore wind energy support operations. Against the backdrop of Japan's renewable energy policy promotion and rising expectations for marine resource development, the company anticipates medium to long-term business expansion potential in this sector.