[General]
  
Q.1   The Ordinary Income forecasted for this Fiscal 2010 shown as 26.0 billion yen has improved from 11.0 billion yen which was set for your mid-term management plan KV2010 released upon previous financial reporting as of January this year. Please tell us segment-wise breakdown of the upward adjustment, how much increase in Containership and how much in Other Marine Business.
  
A.1   Major factor for profit improvement is, in one word, Containership Business.
Although the segment was expected to show loss of 20.0 billion yen for Fiscal 2010 as of the previous financial announcement, this time we expect it will earn 5.0 billion yen profit.
In that way we have estimated 25.0 billion yen improvement in Containership Business, which is partly offset due to drop in profitability of Car Carrier Business.
  
  
  
(Containership Business)
  
Q.1   How much increase in Service Contract (SC) revision for trade line from Asia to North America scheduled for this May did you include in your revised forecasts for Fiscal2010?
Please advise us to what extent ratio of the guidance that TSA (Transpacific Stabilization Agreement) declared was achieved.
  
A.1   Regarding SC renewal situation for Asia-North America trades, as of around April 20, about 40% of contracts to be revised by the end of April on the basis of cargo volume have already been completed. The other portion is being rushed into settlement in this week.
We feel from the response that we could achieve freight restoration almost in line with the guideline TSA announced publicly (US$800/FEU for West coast of North America, US$1,000/FEU for inland and East coast).
  
  
Q.2   Although you indicated that your estimation is based on freight rates throughout this Fiscal 2010 for Asia-Europe trades recovering up to 97% of the level for 1st Quarter Fiscal 2008, considering that present spot rate market in China is rapidly declining, do you see freight rate negotiation scheduled during this April-June period turning into severe condition?
  
A.2   In Asia-Europe trades, portion of 3-month term contracts, so-called short-term contracts, is around 70%, which is rather substantial. Renewals of the other 30% of 1-year contracts were almost completed by the end of March, and we achieved considerable amount of freight restoration from what we had done one year ago.
As you quoted recent China spot rate market is down sharply, just after lunar New Year holidays we surely saw some downturn trends, however, it was then recovered. So, we still believe we can maintain yearly freight rate level at notably higher level for year-on-year comparison. Our forecasts include usual seasonal freight rate swing during the year.
  
  
Q.3   With regard to recent trade-wise profit/loss situation, taking pure profit/loss from marine transport services in each trade of Asia-North America, Asia-Europe, or others, which trade has turned into black, and which remained in red?
  
A.3   For Asia-Europe and North-South trades, freight rate levels look just over the break-even point, and our profitability has rapidly improved. However, the other trade lines remain in severely harsh situation.
  
  
Q4.   Your approaches to even out profit and loss for Containership Business indicated in Slide 10 look slightly changed from what they were originally publicized in January. Factors such as 'Rationalization of Ship Allocations', 'Eco Slow Steaming' and 'Cost Reduction' seem to show some up and down. Please tell us how you see these factor fluctuating, and also whether you changed navigation speed back to normal as the effect of slow steaming became smaller.
  
A.4   This charts in Slide 10 showing our approaches to balance profit and loss have been updated to the most recent data, which I believe has not been changed much comparing with the original released this January.
  
The effect of 'Eco Slow Steaming' amounted to slightly over 5 billion yen here. During Fiscal 2009, especially in winter, we had to cease some of our services in line with decreased cargo demand, and therefore reduced our fuel consumption for the period. In this regard, although the impact from 'Eco Slow Steaming' cannot be so big for year-on-year basis, it is still quite effective for saving oil consumption. Due to global and industry trends on behalf of the environment, we will hardly recover navigating speed to normal level for the time being.
  
For 'Rationalization of Ship Allocations', in the original plan, we had not fully counted on the effect of cooperation with a Japanese shipping company in Asia-North America service routes. This time we updated that with actual figures, which mostly affected the amount.
  
  
  
[Dry Bulk]
Q.1   According to the footnote for the charts on Slide 11, the dry bulker market rate indicated in the chart is based on rates for Pacific Round until Fiscal 2009, and 4 T/C Average from Fiscal 2010. Please give an explanation how you have decided to change the standards.
  
A.1   Although we had made Pacific Round rate for our projection basis until last year, nowadays every kind of dry bulk carrier goes toward China to discharge their cargoes, and so in the Pacific area, an inevitable mass of excessive vessels has assembled. As a result market for Pacific Round has always become lower than the other areas. So we have decided to use 4 T/C Average as our premises from this Fiscal 2010.
  
  
Q.2   Please let us know estimated percent for 'free' ratio in your Panamax fleet.
  
A.2   With regard to the portion for market exposure of our Panamax fleet, it is approximately 17% of the total of about 30 vessels. As it has already become late April, business during this 1st Quarter has almost been fixed with present market level. For about 270 days during the rest of this full year, the market exposure ratio is calculated as such.
For Cape-size, the ratio is under 10%. The smaller the vessel-type becomes, the larger the market linked ratio is. About 70% of Handy-max or Small-handy vessels respectively are daringly exposed to market.