NS United Kaiun Kaisha : Supplementary Material for the FY ended March 2024

1. Highlights of Results in FY2023

Operating Income (Units : 100 million yen)

3. Forecasts for FY2024

◆Change in Operating Income (FY 2022 to FY 2024)

Medium- and small-sized vessels' market declined. Expenses related to the Panama Canal increased. Expenses related to repairs increased as raw material prices rose.

Increase in the number of docked vessels and repair costs, which includes a reduction in revenue due to a decrease in the number of operating days.

Marine Transportation Demand Forecast

Iron Ore: Although there are concerns that crude steel production in China may decline due to the real estate recession, demand in steel-making raw materials is expected to expand globally as crude steel production recovers, and demand in transportation for iron ore is expected to remain strong.

Coal: While a decline in thermal coal imports is expected in China due to an increase in hydroelectric power generation due to a recovery in rainfall, steel production is expected to recover in Europe and Asia, and demand for coal is expected to increase globally.

Grain: In China, demand for maritime transportation is expected to rise moderately, and in other Asian countries including India, demand is expected to grow substantially. In addition, an increase in the shipping distances due to the restrictions imposed by the Panama Canal is also expected to tighten supply.

Minor bulk: Solid demand for bauxite is expected, particularly in China, and solid demand in transportation is expected for minor bulk as a whole.

Dry Bulk Transport Capacity Forecast

Orders for new vessels have remained low because shipowners are carefully assessing which next- generation marine fuels will be mainstream and because vessel prices are persistently high. In addition, against the background of environmental regulations such as the CII and the EU-ETS, it is assumed that slow-steaming voyages to reduce GHG emissions will spread, and the increase in the supply of vessels is expected to be limited. On the other hand, the increase in the price of used vessels will make it difficult for the old vessels to be dismantled, and some other factors are expected to support the supply of vessels.

Demand for Maritime transportation (1 million tons)

Data from our company

Dry bulk volume forecast (1 million DWT)

Data from our company

FY 2024 Futures Indicators at Present

Calculated from future index values dated April 18

Due to strong shipments of iron ore and bauxite, the Capesize market is expected to remain relatively strong. The increase in transportation tonne miles due to the avoidance of the Panama Canal and the Suez Canal is expected to be a factor in the increase in market conditions for the Panamax and smaller types of vessels. As of now, the FY2024 futures index are running at a level slightly above the market assumptions of our earnings forecasts.

Business Strategies and Growth Strategies

• Extending the Domains of New Growing Businesses
  We will expand our business domain through the development of new

cargo shipping fleets by accurately analyzing changes in demand for both coastal and international maritime transportation, including future increases in transportation demand for direct reduced iron, scrap, and liquefied CO ₂ due to the decarbonization of the steel manufacturing process, and the expansion of new demand for liquid bulk transportation, such as ammonia and hydrogen, which are expected to be next-generation energy sources.

• Deepening the Domains of Existing Core Businesses
  Through the deployment of Methanol dual-fuel(DF) vessels to reduce GHG

emissions, we will collaborate with our customers to secure stable revenue through long-term contracts. In addition, we will further approach in India and Southeast Asia where economic growth is expected.

To support the business strategies above, we will strengthen initiatives for sustainability such as human capital strategy and governance enhancement.

Investment Plan

By 2030, we aim to enhance profit stability and achieve medium- to long-term profit growth by investing up to 300 billion yen with financial leverage while maintaining Net DER of 1.0 times or less.

Financial Objectives

We aim to achieve operating income of 20 billion yen and ROE of 10% in FY2027 by accumulating profit from growth strategies as well as from stable return businesses.

We will consider further strengthening shareholder returns with a benchmark payout ratio of 30%.

• Due to the scheduled application of the new accounting standards
  for lease transactions, charter fee liabilities, approximately 80 billion yen in debt expected after fiscal year 2027 is not included in the numerical figures above.

Opening of Representative

Office in Bangkok, Thailand

We have opened a representative office in Bangkok, Thailand on April 1, 2024. By expanding our transportation-related operations to the Southeast Asia region, we aim to improve transportation service quality. In addition, we aim to enhance information collection on cargoes arriving at and departing from Southeast Asia, where cargo movements are expected to increase in the future.

April 30, 2024：Financial Highlights for FY2023

Introduction of Anti-Snap Back mooring ropes to Managed vessels

We have been introducing anti-snap back mooring ropes to our managed vessels since January 2024. This mooring rope was developed by Tokyo Seiko Rope MFG Co., Ltd. and has a highly elastic nylon core inside the triple layer braided rope. This will help prevent accidents for crew members when the mooring rope breaks.

We will continue to make efforts to ensure the safety of crew members and the prevention of disasters by installing this technology on managed and owned vessels.

8