HYOKI KAIUN KAISHA,LTD.

Business Details

The coastal shipping business is centered on domestic marine transportation, carrying steel products, feed, and edible oils via barges and chartered vessels. The ocean-going shipping business uses chartered vessels to transport steel products, construction machinery, and other machinery to South Korea, Taiwan, China, and Central Asia. In FY2026 (ending March 2026), Marine Transportation Business sales were ¥7,599 million, accounting for 56.8% of total company sales. Part of Himeji Port cargo handling operations is outsourced to affiliate Kichimi Co., Ltd., while crew dispatch services are outsourced to Shichiyo Senpaku Kanri Co., Ltd.

Recent Overview

Both coastal and ocean-going shipping saw declines in revenue and profit; overall Marine Transportation Business profit fell 56.9% year on year

In FY2026 (ending March 2026), the Marine Transportation Business recorded sales of ¥7,599 million (down ¥747 million year on year) and segment profit of ¥248 million (down ¥327 million year on year), representing a significant decline in both revenue and profit. In the coastal shipping business, sluggish steel demand, charter contract cancellations, and vessel suspensions due to crew shortages combined to reduce operating profit by 48.7% year on year to ¥165 million. In the ocean-going shipping business, a significant decline in construction machinery transportation to Central Asia, sluggishness in shipments to China, and contraction in steel transportation to South Korea and Taiwan combined to reduce operating profit by 65.0% year on year to ¥82 million. Meanwhile, a company-owned 499-ton vessel is scheduled to commence operation at the end of June 2026, and construction in progress increased by ¥198 million.

Key Products

Growth Drivers

• Expansion of coastal transportation capacity and business scope through the commencement of operations of the company-owned 499-ton vessel at the end of June 2026
• Expansion of spot cargo orders through barge utilization in the coastal shipping business and strengthened acceptance of large special cargo (plant equipment, railway rolling stock, etc.)
• Maintaining continued orders for construction machinery transportation to Central Asia in the ocean-going business and improving per-voyage operating efficiency through collection of mixed cargo beyond construction machinery
• Leveraging comprehensive logistics capabilities through joint sales and joint proposals with other departments in coastal, ocean-going, harbor transportation, and warehousing
• Building a stable operating framework through strengthened direct employment of crew (implemented from FY2025) and securing crew through affiliated companies
• Promoting cost pass-through via introduction of marine freight surcharges and continuing to collect appropriate freight rates

Risks

• Risk of reduced coastal steel transportation volume and charter contract cancellations by shippers due to continued stagnation in domestic demand from steel manufacturers
• Prolonged decline in cargo volume and order sluggishness for China-bound transportation due to China's economic deterioration and worsening Japan-China relations
• Decline in Japanese steel export volume to South Korea and Taiwan due to expanding distribution of low-priced Chinese steel
• Upward pressure on operating costs due to difficulty procuring marine fuel (heavy oil) and persistently elevated fuel costs stemming from deteriorating Middle East conditions
• Risk of ship owner business closures due to crew shortages and aging, and lost earnings opportunities from vessel downtime
• Impact on the ocean-going business from decreased international trade volume due to prolonged U.S. tariff policy and geopolitical risk
• Declining profit margins due to continued intense freight rate competition in near-sea ocean-going transportation