Message from the CEO
To our shareholders and investors
In fiscal 2019, in addition to the effects of China-U.S. trade friction, which had been a factor of concern since the previous fiscal year, the sense of a global economic slowdown became more pronounced from the second half and the world faced the severe impact caused by the spread of COVID-19 at the fiscal year-end. Despite these circumstances, MOL achieved profitability in all of its business segments, with ordinary profit and profit attributable to owners of parent increasing significantly over the previous fiscal year. The Dry Bulk Business and Energy Transport Business were able to generate earnings thanks to the steady accumulation of stable profits from medium to long-term contracts and the relatively strong oil tanker market. In the Product Transport Business, Ocean Network Express Pte. Ltd. (ONE), integrated containership business venture, had its second year of operations and was able to overcome the large deficit it posted in its first year, and turned profitable.
As we entered fiscal 2020, we recognized that our medium- to long-term management strategies would be greatly affected by the spread of COVID-19 and the significant decline in crude oil prices. In the newly established “Rolling Plan Special Committee,” these factors were carefully discussed, and the committee finally formulated the management plan “Rolling Plan 2020,” which we announced on June 22, 2020.
In formulating “Rolling Plan 2020,” we first launched defensive measures as a crisis response. At the same time, we elaborated on our original mid- and long-term forecasts for structural changes in market environment (megatrends) to determine the impact of the COVID-19 pandemic on economic fluctuations. We then examined what the impact would be on our businesses in the future, and made it the base upon which to build our plan. The top priority for this fiscal year will be “Return to A Recovery Trajectory.” We will seize changes as opportunity for steady growth in the post-COVID-19 world, and further push ahead with strategies and structural reforms meeting the characteristics of each business.
Meanwhile, the company remains committed to the goal of achieving its 10-year vision to “Become a Group of Business Units with No. 1 Competitiveness in Respective Areas.” To realize this vision, MOL introduced a new strategic theme—“Enhancement of organizational strength (Refresh organization)”—on top of the existing three core strategies: “Concentrated investment of management resources in the business fields where MOL has strengths, which will mainly be offshore businesses (portfolio strategy),” “Provision of ‘stress-free services,’ which MOL will offer from the customer’s perspective (sales strategy),” and “Promotion of environmental strategies and development of the emission-free business into a core business (environmental strategy).” We will accelerate the implementation of these strategies.
Since its establishment, MOL has been ahead in anticipating the needs of its customers and future demand, repeatedly taken on challenges and kept transforming itself. In this way, MOL has contributed to industries and enriched the lives of people around the world as a multi-modal transport group. The world is facing stormy seas, and it is now time for us to demonstrate our true strengths so that we can overcome these hardships together. By doing so, we will once again reaffirm our value to our stakeholders.
We look forward to your continued understanding and support as we strive to realize our ambitions.
June 22, 2020