NYK Line has allocated ¥200bn ($1.4bn) to acquire treasury stocks in its new medium-term business plan “Sail Green, Drive Transformations 2026 — a Passion for Planetary Wellbeing”.
The Tokyo Stock Exchange-listed company said it would acquire the shares in 2023 and 2024 as part of its aim to improve the capital efficiency of the company.
Details of shareholder returns will be made at its annual earnings announcement.
Last year, compatriot company K Line also announced a ¥100bn share buy-back programme.
Under the new business plan, NYK hopes to reward shareholders by increasing its payout ratio from 25% to 30% and setting a minimum dividend of ¥100 per share.
NYK is lining up a total of ¥1.2trn in capital and business development investment to 2026 under the plan.
A total of ¥460bn has been assigned to decarbonise its shipping business by 2050 through investment in low and zero-emission vessels, the LNG value chain and supply chain optimisation.
The largest capital expenditure — some ¥560bn — will be used for developing its core shipping business, with ¥300bn lined up for investment in LNG carriers and a further ¥120bn for bulk carriers.
Prioritise expansion
There is an additional ¥100bn set aside for business development in areas such as offshore wind and the ammonia, hydrogen and CO2 value chain.
Overall, NYK said it wants to achieve a return on invested capital of 6.5%, as it aims for a net profit of between ¥200bn and ¥300bn by 2026.
NYK said it also wants to prioritise the expansion of liner subsidiary Ocean Network Express (ONE) and “continue to support its growth investments from a shareholder standpoint”.
“The new medium-term management plan comprises a business strategy to realise a corporate group that contributes to society and continues to grow sustainably and a financial strategy to promote management replete with capital efficiency,” NYK Line said.
Its environmental, social and corporate governance targets include achieving a 30% share of female managers and a 30% reduction in carbon emissions by 2030. So far, NYK is scheduled to receive delivery of 31 LNG-fuelled vessels, three ammonia-fuelled ships, eight LPG-fuelled vessels and three methanol-fuelled ships by 2030.
