Tokai Kisen Co., Ltd.
9173・Standard Market・Marine Transportation
Business
Tokai Kisen was founded in 1889 and is listed on the Standard Market of the Tokyo Stock Exchange. Centered on scheduled passenger and cargo routes between the Tokyo Islands (Izu Islands and Ogasawara) and the mainland, the company operates four businesses: Commerce & Food and Beverage, Hotel Business, and Passenger Motor Transportation Business. It operates the passenger-cargo ships "Salvia Maru" and "Tachibana Maru" as well as three high-speed Jetfoil vessels, fulfilling a public mission as lifeline infrastructure for island residents while also serving as resort routes that capture tourism demand. The group, comprising 11 subsidiaries and 1 affiliated company, provides integrated island services ranging from operating the Oshima Onsen Hotel to running buses on the islands.
Business Model
Marine Transportation Business accounts for approximately 88% of net sales, with passenger fares and cargo fares serving as the main revenue source. Routes covered under the Remote Island Route Improvement Act receive subsidies from the national government and the Tokyo Metropolitan Government that supplement earnings (other income of ¥988 million in FY2025). The Commerce & Food and Beverage, Hotel, and Bus businesses complement each other through customer referral linkages with the passenger segment, aiming to build up stable earnings that are less susceptible to fluctuations in transport volume.
Company Strengths
Founded in 1889, the company has a history dating back to its 1907 conclusion of a mandated route contract with the Tokyo Prefectural Government, and operates designated routes based on the Remote Island Route Development Act. Legal and administrative entry barriers are high, and the company maintains a de facto monopolistic position in scheduled passenger and cargo routes connecting the Tokyo Islands with the mainland.
The group comprises 11 subsidiaries, including 5 marine transportation agencies, an onboard service company, a ship repair company, hotels, and bus companies, providing integrated services ranging from passenger transport to intra-island transportation, lodging, and supply distribution. Customer referral collaboration within the group has resulted in improved occupancy rates and average room rates for the Hotel Business in FY2025 (ending March 2025).
The effect of the 2023 fare revision for the Izu Islands routes contributed to full-year results in FY2025 (ending March 2025), supporting revenue. On the cost side, efficient fleet operation and reduced sailing frequency achieved improvements mainly in vessel fuel costs and repair costs. Capital expenditures in FY2025 (ending March 2025) were kept restrained at ¥305 million, significantly below depreciation expenses of ¥1,215 million, maintaining a cash-generative structure.
ENVALITH's Perspective
Performance Trend
Revenue for the first quarter of FY2026 (ending December 2026) was ¥3,319 million (up 1.3% year on year), a slight increase. Demand-side metrics improved, with passenger numbers of 157 thousand (versus 146 thousand in the same period of the prior year) and cargo volume of 72 thousand tons (versus 70 thousand tons in the same period of the prior year), but the operating loss widened to ¥58 million (versus ¥33 million in the same period of the prior year) due to increased ship repair costs and personnel expenses. The full-year forecast calls for revenue of ¥14,820 million (up 3.7% year on year) and operating profit of ¥260 million (down 50.3% year on year), pointing to a significant profit decline. Looking at the trend over the past five fiscal years, profit levels improved from ¥198 million in FY2021 to ¥582 million in FY2024 and ¥524 million in FY2025, but a reversal is expected in FY2026 due to cost increase pressures. As external factors, rising prices, labor shortages, and surging crude oil prices are acting as headwinds on the cost side.
Growth Strategy
Building on the reconstruction of safe operations as a foundation, the company aims to establish a sustainable earnings structure by making the Commerce & Food and Beverage Business a third pillar of profitability and by improving cost flexibility
Through enhanced information outreach to younger demographics via influencer invitations and collaboration with travel agency-organized tours (such as the Kawazu-zakura Festival), the number of ferry passengers expanded 7.5% year-on-year to 157 thousand. The company continues to focus on capturing both individual and group customers.
To build a stable business structure less susceptible to fluctuations in passenger numbers and cargo volume, the company maintained solid performance in onboard vending machine and restaurant revenue. A decline in cement sales due to delays in public works projects remains a challenge, but the food and beverage segment showed stable performance. Operating profit of ¥21 million was maintained at the same level as the same period of the previous year.
The company shifted its primary sales channel from online travel agencies to the passenger transportation division and proprietary sales, resulting in increased overnight guests and day-trip visitors. Cost improvements were also achieved through labor productivity enhancement measures. Net sales reached ¥108 million (versus ¥94 million in the same period of the previous year), and operating profit reached ¥19 million (versus ¥9 million in the same period of the previous year), representing a significant improvement.
A fare revision for the Route Bus (Fixed-route Bus) was implemented starting January 2026. Combined with demand for Route Bus and Chartered Bus services during the Camellia Festival period, net sales reached ¥95 million (versus ¥86 million in the same period of the previous year), and operating profit reached ¥22 million (versus ¥17 million in the same period of the previous year), achieving increased revenue and profit.
Increases in ship repair costs and personnel expenses were the main factors depressing profit in the first quarter of FY2026 (ending December 2026), making cost management over the full fiscal year a key challenge. Depreciation expense declined slightly to ¥287 million (versus ¥296 million in the same period of the previous year), but upward pressure from repair costs and personnel expenses continues.
Last updated: July 17, 2026