We announced our new three-year midterm management plan GEAR UP! MOL (FY2010- FY2012) on March 31, 2010. Let me take this opportunity to explain the goals of the new plan and discuss the MOL directions it will lead us in over the next three years.

Main theme: Challenge to Create New Growth

Since the dawn of the present century, our company achieved growth and expansion of scale through two midterm management plans (FY2001-FY2006). In the third midterm plan, MOL ADVANCE (FY2007-FY2009), we re-emphasized ensuring safe operation as the highest priority after learning difficult lessons from several serious marine incidents during 2006, and set the main theme as "growth with enhanced quality." We set our sights not only on expanding the scale of our business, but also on improving the quality of our service, which aims to be world best-class safe operation. Midway through this plan, in 2008, global demand contracted sharply in the wake of the Lehman Shock and the ensuing economic crisis. Our company promptly scaled back our fleet while maintaining a balanced business portfolio and implementing an emergency cost reduction plan. These measures minimized our losses and positioned us to turn a profit in FY2009 even as the world's other major ocean shipping companies plunged into the red. And now, we are standing on the starting line to meet the challenge of creating new growth.

Three new challenges

In the GEAR UP! MOL plan, we set the following three pillars as our primary tasks: First, recovery from the economic crisis and acceleration of business development in growing markets; second, enhancement of safe operation; and third, environmental strategies. Accomplishing these tasks, we will be able to restore the profitability that temporarily came to a standstill and return to "cruising speed."

Looking at the first pillar, it is clear that emerging countries will account for a steadily rising share of global commerce, so we will shift our axis of business toward global, growing markets, mainly in emerging nations, to increase profits. As the platform supporting this strategy, we will push to improve our information-gathering capabilities and analysis skills, which are the basis of management decision-making. In other words, we will move to strengthen our business intelligence. However, this does not eliminate the risk of an unpredictable event, so we will introduce new methods, such as visualization of risk levels, to upgrade our risk management. On the other hand, we continue to enhance cost competitiveness, especially in the containership segment, which bore the brunt of the economic crisis, and are building a foundation to dominate the industry on a global scale after the economy recovers.

Safe operation forms the basis of our business not only for growth as a company, but also for gaining the trust of society and building a strong reputation. In GEAR UP! MOL, we focus on setting the highest global standard in safe operation. We will provide the best safety equipment and systems (hardware) of course, while paying close attention to the "software" side as well: recruiting top-quality seafarers and giving them the best training in the world. We will also upgrade our capability to detect and react to dangerous situations and continue to draw on improved information technology to realize faster communication of safety information. All these high-grade efforts will help minimize the risk of an accident triggered by human error.

As international concerns over environmental issues, including global warming, mount and as MOL works on a global scale, environmental protection is one of our top priorities, on a par with safe operation in the MOL Group Corporate Principles. The next-generation vessel concept ISHIN project announced in September 2009 is an innovative approach that will reduce CO2 emissions using feasible technologies and contribute to global environmental protection immediately and significantly. In GEAR UP! MOL, we will invest a total of 28 billion yen over three years in ISHIN and other projects aimed at reducing the environmental burden of our operations and developing and applying new green technologies.

The key word is "credibility"

During the financial crises after the Lehman Shock, credibility was discussed in various situations at both the national and corporate level. While the weakened world economy has been recovering, the credibility that will ensure high-quality service over the long term plays a key role to earn and maintain the trust of customers. Our company strives to further improve our financial strength, offer highly competitive services in terms of safe operation, quality of transport, and utmost credibility, and fuel expansion of our business and improvement of profitability.

We will not dwell on our past successes, but will rather renew our ambition, go back to the basics of our business, and continue meeting the challenge of new growth, to make the MOL Group an excellent and resilient organization that leads the world shipping industry. We thank you for your support and look forward to your continued cooperation.