Summary of Financial Results

In the business environment surrounding the Yamato Group, the global inflationary trend became more stable, while in Japan it remains hard to anticipate a full-fledged economic recovery. Although the economic sentiment is in a recovery trend, with cost inflation being passed on to prices as well as other factors, and the decline in real wages is coming to a halt, consumer spending remains sluggish, and the labor shortage is becoming more serious, together with other factors. Under these circumstances, the Yamato Group is promoting initiatives based on the medium-term management plan "Sustainability Transformation 2030 ~1st Stage~", to create “economic value”, as well as “environmental value” and “social value” to make our society more sustainable, including growing profits in the base domain by strengthening the TA-Q-BIN network, expanding the corporate business domain by providing business solutions, commercializing new business models to address the diversifying needs of customers and society, and strengthening the Group’s management platform, in order to achieve sustainable corporate value enhancement through the concept of “Helping to enrich our society”, which is part of our Management Philosophy.

As for the consolidated financial results for the six months ended September 30, 2024, operating revenue was lower than the previous forecast (announced on August 1, 2024) due to lower-than-expected parcel delivery revenue, as a result of volume being below expectations amid continued weak consumer spending, and the decline in average unit prices due to changes in the parcel mix and other factors, as well as the fact that it is taking time to capture new demand using Yamato’s dedicated cargo aircraft (freighters). Operating profit fell short of the previous forecast, despite our focus on initiatives to optimize operating costs in accordance with the workload, mainly due to higher hourly wages and outsourcing unit costs due to changes in the external environment, as well as costs being higher than expected in the Transportation domain due to lower loading efficiency. As a result, ordinary profit and profit attributable to owners of parent were also below the previous forecast.

Regarding the consolidated financial forecast for the full year, operating revenue has been revised down to 1,730 billion yen (down 50 billion yen from the previous forecast), taking into account the situation in the six months of the fiscal year (the first half) as well as the future outlook. As for operating profit, despite the focus on optimizing operating costs and curbing operating expenses, especially outsourcing costs, the forecast has been revised down to 10 billion yen (40 billion yen lower than the previous forecast), based on the operating revenue forecast. Based on the above, we have revised downward the forecast for ordinary profit to 10 billion yen (a 40 billion yen decrease from the previous forecast), and the forecast for profit attributable to owners of parent to 5 billion yen (a 27 billion yen decrease from the previous forecast).