en.Wedoany.com Reported - Japan's Mitsui O.S.K. Lines Group announced a new management plan on March 31st aimed at enhancing the company's profitability and shareholder value. The plan sets a target to achieve a pre-tax profit of 420 billion yen (approximately $2.8 billion) by the fiscal year 2030, a significant increase from the previous target of 240 billion yen.
According to the strategy, starting from FY2026, Mitsui O.S.K. Lines Group plans to invest approximately 1.81 trillion yen over the next five years for business expansion. These funds will primarily be used for the delivery of 18 bulk carriers and 53 liquefied natural gas and liquefied petroleum gas carriers to strengthen its energy sector.
Mitsui O.S.K. Lines Group emphasized that it will adopt a hybrid business model, combining stable revenue sources with market-driven opportunities to cope with industry volatility. The company noted that its car carrier and chemical tanker businesses, due to their high entry barriers, help mitigate risks during periods of market instability.
Regarding financial targets, the company plans to achieve a return on equity exceeding 10% and a return on assets of 5.5% by FY2030. To enhance capital efficiency, Mitsui O.S.K. Lines Group will also recover approximately 230 billion yen in real estate assets over five years.
The shareholder return policy includes implementing a progressive dividend starting from FY2026, with an initial per-share payout of 205 yen. This strategy aims to achieve a total payout ratio of about 40% through dividend payments and flexible share buybacks.
Activist investor Elliott Investment Management recently acquired shares in Mitsui O.S.K. Lines Group and evaluated the plan after its release. In a statement on April 1st, the investment firm said, "These measures are positive steps towards improving shareholder returns and enhancing capital efficiency."
However, Elliott also expressed concerns, stating that the management plan "does not go far enough in closing the significant gap in shareholder returns between Mitsui O.S.K. Lines and its peers." The investment firm also pointed out that the company needs to address the unrealized gains on ships and real estate on its balance sheet.
Elliott stated that it will continue to work with Mitsui O.S.K. Lines Group to drive the company's share price to a level above book value by "concretely addressing the factors behind its deep undervaluation."
The management plan also includes the introduction of a hard sail system on a new liquefied natural gas carrier, which is expected to help reduce fuel consumption and improve operational efficiency.
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