To Our Shareholders

　During the fiscal year ended March 31, 2025 (“the fiscal year under review”), amid continuing geopolitical risk overseas associated with the situations in the Middle East and between Russia and Ukraine, the Japanese economy showed a moderate recovery driven by growth in inbound tourism demand and increased capital investment by companies. However, the outlook remained unclear as consumer spending and investment in housing remain sluggish due to the impact of rising prices.

In the transportation industry, which is the mainstay business of the Seino Group, as the volume of freight transportation in Japan shrank year on year, the conditions surrounding corporate activities continued to be severe mainly due to soaring energy prices and measures taken in response to the “2024 problem.”

Operating under such conditions, in the second year of “Medium- and Long-Term Management Direction — Vision and Roadmap 2028,” the Group aimed for an ROE (return on equity) of 8.0% or higher in order to quickly realize a PBR (price book-value ratio) of at least 1.0 times through growth and appropriate capital measures. Under the plan, we worked to maintain our competitive edge in our core business of special mixed freight transportation, while positioning the logistics and charter business, which are our key initiatives, as growth engines and deploying measures that struck the right balance of growth, profitability, and capital efficiency with the aim of making higher-profit margins integral to our operations.

Additionally, on October 1, 2024, Mitsubishi Electric Logistics Corporation was made a consolidated subsidiary of the Group and its name was changed to MD LOGIS CORPORATION on said date. We are integrating the advanced logistics knowhow of this company into the Group’s logistics networks and systems to pursue further added value not only in Japan, but also from a global perspective. This new consolidation has made a considerable contribution to earnings in the Transportation Services Business.

As a result, operating revenue for the fiscal year under review was ¥737,377 million (up 14.7% year on year), operating profit was ¥29,883 million (up 27.7% year on year), ordinary profit was ¥28,124 million (up 14.8% year on year), and profit attributable to owners of parent was ¥19,253 million (up 32.2% year on year).

Transportation Services Business

Regarding the Transportation Services Business, in our mainstay special mixed freight transportation business, we have leveraged our nationwide route network to make progress in receiving reasonable transport fees, focusing on the long-distance and heavy-load categories, which we consider our strengths. We also implemented various measures to align expenses with appropriate levels by revising transportation structures to correlate with the volumes of cargo handled, among other efforts.

On the other hand, there was a slight year-on-year decline in the volume of cargo handled as consumer spending remained sluggish due to the impact of rising prices. Additionally, there was an increase in chartering and outsourcing expenses due to a shortage of drivers caused by the number of new recruits failing to grow in proportion to the number of drivers leaving due to retirement and other reasons, as well as limits on the maximum number of hours that drivers can work overtime resulting from the “2024 problem.”

Seeing this “2024 problem” as an opportunity for change, in May 2024, we concluded a business alliance with JAPAN POST Co., Ltd. and started carrying out joint transportation on trunk routes. This alliance is focusing on accelerating initiatives to make the entire industry more efficient and to continuously maintain transportation quality over the long term through measures such as supplementing each other’s operations in low-efficiency regions through an O.P.P.^* that transcends boundaries between companies.

In terms of expansion efforts, Seino Transportation Co., Ltd. rebuilt the distribution warehouse at its Toyokawa branch (Toyokawa City, Aichi Prefecture), and Seino Super Express Co., Ltd. relocated its Fukuoka cargo center (Higashi Ward, Fukuoka City). In this way, we worked to expand our earnings by strengthening our logistics infrastructure.

As a result of the above, as well as an increase in earnings associated with the consolidation of MD LOGIS CORPORATION, operating revenue for this segment was ¥554,126 million (up 17.8% year on year) and operating profit was ¥20,743 million (up 35.8% year on year).

* O.P.P.: An acronym for open public platform. We are building an open logistics platform that enables collaboration and can be used by anyone internal or external to the company and in any business domain. This platform will create efficiencies and value of each user and contribute to industry, the environment, and daily life as social infrastructure. 

Vehicle Sales Business

In passenger vehicle sales of the Vehicle Sales Business, the new vehicle sales volume declined year on year due to the effects on the orders environment of factors such as delays in the announcement of new vehicles caused by the impact of the issue regarding the misconduct of manufacturers concerning certification in past fiscal years, as well as delays to production and shipment at manufacturers. However, operating profit grew considerably due to strong sales of vehicles in higher price ranges and measures to strengthen sales centered on direct sales.

In used vehicle sales, the overall volume of vehicles sold, including wholesale sales, fell year on year, despite retail sales growing as each dealer was able to secure display models due to revisions to the used car productification process.

In truck sales, amid the continued suspension of production of some vehicle types as a result of the issue regarding the misconduct of manufacturers concerning certification in past fiscal years, new vehicle sales recorded a considerable year-on-year increase due to a rebound effect from sluggish sales in the previous fiscal year, as well as measures to tap into substitute demand.

In terms of office expansion efforts, TOYOTA COROLLA NETZ GIFU CO., LTD. relocated the service workshop of its Gifu branch (Gifu City, Gifu Prefecture) into a new building and renewed the service workshop of the Corolla Hashima branch (Hashima City, Gifu Prefecture), improving customer satisfaction and the efficiency of the store network.

As a result of the above, operating revenue for this segment was ¥115,328 million (up 6.1% year on year) and operating profit was ¥7,161 million (up 23.3% year on year). 

Merchandise Sales Business

The Merchandise Sales Business engages in the sale of fuel, paper and paper products, and other products. There was a rise in sales unit prices for fuel sales and sales of nursing care goods were firm, particularly domestic tissue papers for nursing care. As a result, operating revenue for this segment was ¥38,780 million (up 8.5% year on year) and operating profit was ¥1,169 million (up 23.4 % year on year).

Real Estate Leasing Services Business

In the Real Estate Leasing Services Business, we worked to utilize our holdings of land and former sites to maximize their potential and transform this business into one that provides more valuable leasing services for each region. As a result, operating revenue for this segment was ¥2,354 million (up 4.8% year on year), and operating profit was ¥1,731 million (up 5.0% year on year). 

Other Business

The Other Business segment includes the information services business, the personnel services business, the construction contract business, the housing sales business, and the taxi business. Operating revenue for this segment was ¥26,786 million (up 3.4% year on year), and operating profit was ¥1,829 million (up 31.1% year on year).

For the future outlook for Japan’s economy, business conditions are expected to recover at a moderate pace due to improvements in the employment and income environment and the effects of various government policies. On the other hand, the risk of an economic downturn is rising due to inflation driven by U.S. trade policy (tariffs), and fears of negative movement in consumer sentiment.

In the transportation industry, which is the mainstay business of the Seino Group, the environment continues to be marked by factors such as yen depreciation, unstable crude oil supply volumes, driver shortages, and a decline in the working population.

In our initiatives in this third year of “Roadmap 2028,” we will use such circumstances as a tailwind. In our special mixed freight transportation business, which is the core of the Transportation Services Business, we will address the “2024 problem” by advancing our O.P.P. in order to realize a sustainable society and make the entire logistics industry more efficient. We will aim to achieve the “Team Green Logistics” by creating the future together with a variety of partners that transcends boundaries between industries. Furthermore, we will continuously work to secure reasonable transport fees to ensure sustainable transportation capabilities, while providing customers with added value.

In the logistics business, a growth area, we will create value by practicing consulting-based sales that leverage our logistics diagnostics services to address customers’ labor shortages by acting on their behalf to make logistics improvements and enhance operational efficiency. We will also further expand our business through proposals that meet customer needs by developing logistics that are tailored to each of the electronics, healthcare, and automotive battery industries.

In the charter business, which is also a growth area, we have concentrated customer communication channels at the charter shipping dispatch centers with the aim of enhancing customer satisfaction through swift responses, and we will also strive to enhance convenience through efforts including using HACOBELL functions to expand the area in which charter arrangement is 100% guaranteed.

In passenger vehicle sales in the Vehicle Sales Business, we will enhance customer satisfaction by optimizing our branch network, including renewing branches and service workshops, consolidating branches based on analysis of commercial area reach, and advancing plans for new branches. Also, in order to recruit, develop, and retain mechanics to undertake our highly profitable services, we will continue to improve workplace environments, build career plans for all employees, including sales staff, and enhance and expand training programs, with the aim of creating branches that will be chosen by customers.

In truck sales, although the supply of some new vehicle types is still limited, we will accelerate new vehicle sales as we have a prospect for resuming orders for large trucks. Additionally, we will seek to increase sales of leases and financial instruments such as insurance. We will also create work for our highly profitable maintenance business by offering tailored sales solutions, such as preventive maintenance proposals that reduce the risk of costly breakdowns on the road for the customer.

In the Merchandise Sales Business, Real Estate Leasing Services Business, and Other Business, we will take steps to expand each business domain and strengthen our existing businesses.

 To all shareholders, we sincerely ask for your ongoing encouragement and support into the future.

　June 2025

　　 Yoshitaka Taguchi,
 President and Chief Executive Officer

Takao Taguchi,
 Representative Director