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The time has come to start the meeting for media on the third quarter for fiscal 2018 earnings for Hitachi, Ltd. I would like to introduce the speakers to you first. In the middle is Mitsuaki Nishiyama, Senior Vice President and Executive Officer, CFO; Tomomi Kato, General Manager of the Financial Strategy Division; and to the left, Yasuo Hirano, Executive General Manager, Corporate Brand and Communications Divisions. Now I would like to ask Mr. Nishiyama to start with the explanation.
I would like to refer to the slides. First of all, 2 or rather 5, Page 5 should be referred to. In the middle, we have the third quarter year-to-date numbers. At the very top, the revenue was JPY 6,782.9 billion, that is up JPY 108.9 billion year-on-year or 102%. And next is adjusted operating income ratio. Our income is JPY 534.5 billion and that is increased by JPY 59.9 billion year-on-year. EBIT JPY 305.4 billion, decline of JPY 167.3 billion year-over-year. This is because of the impairment of the Horizon Project included in this line. As a result, the net income attributable to Hitachi, Ltd. stockholders was JPY 82.6 billion, minus JPY 175.9 billion year-over-year. In terms of the revenues, an increase by 2% was achieved. The information technology, railways as well as construction machineries have seen growth. And in terms of operating income, that was increased by JPY 59.9 billion as semiconductors as well as smartphones, automotive industry was declined in terms of functional systems as well as Automotive Systems were subject to decline. But in terms of Information & Telecommunication Systems as well as Social Infrastructure & Industrial Systems have improved profitability. Construction machineries revenue increase has led to the improvement in the operating income. In terms of operating income. On adjusted basis, we have achieved our highest level ever. In the past, it used to be 217 was the highest level, but we have been able to establish a new record. Next is 1-3. I would like to talk about the factors affecting changes in revenues and adjusted operating income. Left-hand side is revenues. Hitachi Kokusai Electric reorganization had an impact to the tune of JPY 120 billion decline. Foreign exchange impact, JPY 27 billion. These are the deterioration impact. U.S. dollar and Hitachi Construction Machinery as well as the emerging countries foreign exchange was subject to yen increase, higher yen for Smart Life & Ecosystems (sic) [ Smart Life & Ecofriendly Systems, ] and that means that 4% increase was achieved. I am looking at the operating income. There was impact of reorganization of Hitachi Kokusai Electric minus JPY 16 billion, foreign exchange minus JPY 4.5 billion. If we exclude this, profitability improvement of JPY 80.4 billion was achieved or 18% increase year-over-year was achieved. And please refer to the next page. This is looking at the Horizon impact of the operating income, and we have looked at the other components leading to the net income attributable to Hitachi, Ltd stockholders. There was also income tax as well as corporate tax as well, but the most significant impact was the impairment loss of the project suspension of Horizon Project to the tune of JPY 277.2 billion, which was posted in the third quarter. Left-hand bottom table shows more details. Impairment loss was JPY 277.2 billion posted in the third quarter. For this amount, there is no cash flow impact. And for the fourth quarter, there will be other expenses related to this project relating to cancellation of the contract as well as one-off expense, which will be posted in the fourth quarter to the tune of JPY 21 billion. There will be cash outflow in this regard. In the fourth quarter as well as partially in the first quarter, this JPY 21 billion will be posted and it will be subject to our cash outflow. Now regarding JPY 277.2 billion, the impairment loss is not taken into account for taxable income. Therefore, deferred tax asset is not recognized. There will be no tax effect. And please refer to 1-5. This is looking at the overseas as well and outside Japan. Please look at the -- for -- the Japan is 101%. Overseas increased by 2%. And in terms of regions, China was at 99% and China is slowing down in that regard. Next, please look at cash flow. At the very top is JPY 9,693,400,000,000 is the balance sheet as for December 31, 2018. This is a decline of JPY 413.1 billion. This includes the amount for Horizon as well. And CCC, is the third line from the bottom, 70.9 days. And we will aim for 70 days by the year-end, and the total Hitachi stockholders' equity ratio is 32.4%. Our D/E ratio is 0.31x. We have made a significant impairment. However, the financial soundness remains intact. And cash flow is JPY 202.3 billion and IEP cash inflow has fallen off, and there was also working capital increase from Construction Machinery and decline by JPY 270.8 billion. In terms of cash flows from investing activities is minus JPY 175.4 billion, and the investments has -- the previous year has fallen off. Agility Trains West stake has been sold and also, the shareholdings have also been included here. And therefore, as a result, free cash flow was JPY 26.8 billion. Now 1-7 and 8 are by segment. At the very top, we have Information & Telecommunications Systems, a 3% increase in terms of revenues. ALAXA (sic) [ ALAXALA ] Networks stock transfer was made. And as a result, impact is reflected. But in terms of system, integration business has expanded. And as a result, increase of 3% year-over-year. And in terms of operating income, increased by JPY 38.7 billion. Profitability improvement in the system integration business as well as profitability improvement in the IT platforms and products. In addition, there was also some real estate disposal as well. And therefore, EBIT increased by JPY 60.5 billion year-over-year. And next is Social Infrastructure & Industrial Systems. Our railway systems Europe, revenue has increased. And Sullair acquisition has led to the increase in revenues of Industrial Products, increased by 5%. Adjusted operating income as a result of railway system business revenue increase and profitability improvement in Industry & Distribution field and increase in revenues and profitability improvement in Industrial Products business has led to the increase by JPY 34.2 billion. EBIT on the other hand is minus JPY 153.7 billion and declined by JPY 211.2 billion year-over-year. The Agility Trains West stocks gains was posted, but there was impairment loss due to the suspension of the Horizon Project. And because of this amount, the impact has been shown, the impairment was JPY 278 billion. 1-8 should be referred to, Electronic Systems & Equipment. There was a decline in revenues as well as income. 91% was the revenue level. This is because of the Kokusai Electric impact. And if we exclude this, it's 108%. Hitachi High-Technology and Semiconductor products did well in terms of sales. And in terms of health care, the radiation therapy systems saw sales increase. Therefore, in reality, there was a increase in revenues. Now the adjusted income -- operating income was minus JPY 0.7 billion. But if we exclude the Hitachi Kokusai Electric, there was an increase in revenue. Hitachi High-Technologies and Hitachi health care business sales increased and pushed up the profit. Next is Construction Machinery increased by 9% in terms of revenues in Asia Pacific as well as Australia. North America saw strong sales. And operating income increased by JPY 19 billion year-over-year. However, in terms of EBIT, it's only half of the increase in revenues. This is because of the posting of the exchange loss as well as posting of structural reform expenses. Next, 1-9. High Functional Materials & Components. Hitachi Chemicals, Hitachi Metals acquisitions have increased the revenues, and there was also an increase of sales price linked to higher raw material prices at Hitachi Metals, an increase by 5% year-over-year was achieved. But in terms of operating income, minus JPY 11.1 billion. This is because of the change of product mix and increase in raw material prices at Hitachi Chemicals and a decrease in demand for materials for FAA, semiconductors and electronic products at Hitachi Metals. Automotive Systems at 98% year-over-year. This is because sales decreased in China and North America. Also, Clarion revenues have declined. In terms of operating income, minus JPY 14.7 billion year-over-year. In terms of EBIT for third quarter, operating income declined and there was impairment of fixed assets. There was also structural reform expenses posted. As a result, decline of JPY 46.6 billion in EBIT year-over-year. Next is Smart Life & Ecofriendly Systems at 88% level year-over-year. This is because of change of accounting to net basis revenue for a part of procured products in Japan. There was also a decrease in sales overseas, mainly in Middle East market and price decline of home appliance products in Japan. As a result, our operating income declined by JPY 5.8 billion. And this is increase in raw material price as well as impact of foreign exchange as well as a price decline of the home appliances in Japan have been reflected in the lower operating income. In terms of Corporate items & Eliminations, JPY 37.2 billion EBIT increase has been posted. This includes the gains by selling Hitachi Kokusai Electric stock. Slide 1-11, Topics. First line. Lumada business revenues in total came to JPY 757 billion, up 12% year-on-year. For the forecast for the full year, earlier we said it's JPY 1,080 billion, but we are expecting a JPY 10 billion more and year-on-year increase is expected to be 7%. In the third quarter, in order to expand Lumada solutions, we are collaborating with Suntory Beverage & Food, a production planning system utilizing AI. We are supporting the client for a stable product supply and improvement of workflow efficiency. And with Tokyo Marine & Nichido, we have started a collaborative creation to promote digitization of manufacturing sites and we are providing a new service combining the predictive maintenance service and insurance utilizing Lumada solution. As part of expansion of global co-creation initiatives, the largest state-owned commercial bank in India, State Bank of India, we're working with them to establish a joint venture. Their branch network, combined with Hitachi's digital technology, can provide for a digital payment platform that will enable better convenience and quality for India. Moving on to the next slide, 1-12, for other topics. One of such topics is, as you all know, we're looking to strengthen Hitachi's Energy Solutions business. We have decided to acquire ABB's power grids business. In the early half of 2020, we are planning to set up a joint venture with them. We're going to acquire a global customer base and build an energy platform. Next, regards structural reform of Automotive Systems business. We are responding to tender offer conducted by Faurecia for the shares of Clarion. We're going to deconsolidate at the end of March. And we have also decided to transfer the shares of Hitachi Automotive Systems measurement and transfer commercial vehicle steering business to Knorr-Bremse AG, a German company, and the closing is scheduled on March 1. Automotive lithium battery business. In this area, we are going to transfer our part of shares of Hitachi Vehicle Energy to INCJ by the end of March. With respect to railway systems business, we sold part of shares of Agility Trains West Limited. We have also acquired the remaining shares of Ansaldo STS. And as of January 30, we made it a fully owned subsidiary, so that we can increase our synergies further. If you could please turn to Slide 2-1. Outlook for fiscal year 2018. For the full year, revenue and adjusted operating income have remained unchanged since the last report. Revenue JPY 9.4 trillion. Adjusted operating income JPY 750 billion, up 8% year-on-year. EBIT 500 billion. We are going to post the sales proceeds from various business sales. We now have an idea as to what can be posted by the end of March, so we have added JPY 50 billion as a result. Net income, the last forecast was JPY 100 billion, but now it's been revised upward by JPY 80 billion to JPY 180 billion. Just for your reference, there are 2 columns to the far right. Impact from the suspension of Horizon Project, in terms of EBIT, JPY 298 billion. In terms of net income, JPY 294 billion. Excluding these, the income is JPY 474 billion, but JPY 294 billion of Horizon is reflected and that's the number. Now by segment. Just to highlight the changes made. Slide 2-2 and 2-3. Information and telecom systems, plus JPY 7 billion on top of the last forecast upward revision. Social Infrastructure & Industrial Systems, plus JPY 10 billion. Now High Functional Materials & Components on the other hand, downward revision or decline by JPY 30 billion from the last forecast. Automotive Systems, downward revision, JPY 12 billion. Smart Life & Ecofriendly Systems, a revision downward, of JPY 4 billion. Others, plus JPY 7 billion. Corporate Items & Eliminations, plus JPY 22 billion. So the risk that we talked about earlier, JPY 20 billion is reflected in these numbers. So that concludes my presentation. Thank you.
We would now like to take questions. The floor is open.
I have 2 questions. Just now, JPY 80 billion upward revision has increased. Why is this the case? Please elaborate further.
For Horizon, in the 17th of January, I talked about an impairment of JPY 300 billion was included and from JPY 400 billion was the forecast and subtract by JPY 300 billion leading to JPY 100 billion. And in 1-12, I talked about topics in the Automotive Systems business. There have been businesses that have been sold. Clarion was already included in the forecast. However, and Clarion -- JPY 65 billion will be the proceeds. That has already been reflected in the original forecast. And next one, the third one, Hitachi Automotive Systems Management and the commercial vehicle steering business and Hitachi Vehicle Energy transfer. With these 3 business transfer, it amounted to JPY 30 billion. At the time of 17th of January, it has not been reflected because the closing was still unclear at that time. It was not included at that time. So in addition to this, Agility Trains West and this also was finalized after the announcement made last time. Therefore, these have been factored in. For the most structural reform expenses were subject to review. As a result, it was also I mentioned -- we mentioned JPY 1 billion, but now we have taken into consideration other business transfers, so major revision from JPY 1 billion to JPY 180 million.
Regarding Agility Trains West, how much was this sold for?
We are not announcing -- disclosing such information.
Regarding China, and it is 99% slowing down in terms of the market. Which products are subject to decline or slowdown? And GDP have been slowing down for China inclusive of the forecast going forward, please elaborate?
For China, our main business is Construction Machinery in that region as well as elevator business. However, up until the third quarter, they remained relatively strong, but elevator was subdued. And for Construction Machinery, there was decline. And which -- and Automotive Systems, the decline in this business was very significant. So there was decline in terms of segments. Automotive Systems, the revenues have declined in this market. So there was decline in Automotive Systems as well as Construction Machinery. For Construction Machinery, on a year-to-date basis, we have [ not ] provided numbers, but for the third quarter alone, there has been a decline.
What is the forecast outlook going forward?
This is difficult to elaborate because in terms of elevators, in terms of number of units, units remain strong. It is increasing, although the price is declining. Therefore, total revenues is likely to increase on a full year basis. That is our forecast. For the fourth quarter, we believe that it will continue on the increasing trend. But in terms of Construction Machinery, it is subject -- it is likely to decline. Automotive Systems on the other hand, for China, the third quarter trend is likely to continue.
Any other questions?
I have a question regarding your Lumada business. The full year forecast has been revised upward by JPY 10 billion. It's an addition to the core business. So in which areas are there likely to be increases? Next fiscal year and onward, how are you going to continue to drive Lumada business? It's going to be key. So what are your ideas?
Lumada core business, as you rightly said, is very crucial. For one thing, solution core business is increasing and the actual revenue is rising in industrial areas, especially factory automation, efficiency improvement, quality improvement in factories and plants, such applications are increasing in number. And those areas related to FinTech and financial services, AI is being applied. So such applications are also increasing. By segment, roughly speaking, information and telecom systems, 80% and the remainder industrial systems. In terms of information and telecom systems, industrial as well as financial services applications are increasing and industrial systems as well. Railway systems, predictive maintenance and diagnostics, for such purpose, Lumada is being applied, and we believe that this trend will continue. Given the overall macroeconomic environment, investment into hardware, we are not sure of the prospects. But in terms of efficiency enhancement, quality improvement in industrial areas and financial services and public services, in those areas, energy saving, labor saving or creation of new services. These areas are expected to increase.
I have 2 questions. Now JPY 750 billion is the forecast for your profit, but it has not changed, but Mr. Higashihara, when he had the meeting on Horizon Project, he said that 8% of operating profit margin should be achieved without fail. And I understand he is committed to achieving this. But by segments, there are ups and downs. And therefore, once again, please talk about your outlook for this -- achieving this number?
Yes, there are ups and downs. The situation is mixed. For High Functional Materials & Components and Automotive Systems, for these segments, the business environment is not favorable and also there are challenges that must be overcome. There are challenges that will take time, although there might be challenges that can be overcome in the short term. So the situation is mixed. And the difficult situation is likely to continue going forward. And the forecast is reflecting these factors. But on the other hand, for Information & Telecommunication Systems, the IT platform, storage and cost reduction has been achieved. New models has been introduced to the market according to schedule, we are making progress. And therefore, this business remains strong. Project management is conducted in a steadfast manner, and therefore, this business remains very strong for us. For the Social Infrastructure & Industrial Systems, the building system. In terms of the sales price, especially in China, it is subject to decline, but the scale of decline is decreasing and cost reduction is being achieved and raw material cost increase has been absorbed by cost-reduction efforts. And in terms of industrial and distribution area, project management is successful, and railway systems remain very strong for us. Therefore, in terms of Social Infrastructure & Industrial Systems, we believe that the trend is strong. For Construction Machinery on the other hand -- for -- Hitachi Construction Machinery has assumed 100, but we are looking at 105 for the fourth quarter. So it has been adjusted accordingly. But excluding China, the business remains strong. Furthermore, the emerging currency foreign exchange is having an impact as well. It is very difficult to forecast the trend in this area. Therefore, on the part of Hitachi Construction Machinery as well as on the part of Hitachi, we are taking a conservative outlook. Furthermore, in terms of Automotive Systems, the difficult situation is likely to continue. This is being reflected accordingly. Smart Life & Ecofriendly Systems, for home appliances, sales are declining in the Middle East, leading to a revenue decline, which is being reflected in the numbers accordingly.
Is this going to overlap with what you have already responded to next fiscal year and beyond, if the current difficulty in environment continues for the Automotive Systems as well as the High Functional Materials & Components are likely to be difficult? And based on that in order to secure the high income level, what is necessary in terms of measures? What are you implementing today? Operating income, highest record. Is that a viable objective for you to achieve?
Regarding the outlook for 2019, the macroeconomic uncertainty must be considered. And in terms of smartphones as well as FA areas, Automotive Systems, in the industries, the demand outlook remains difficult. We are compelled to have a very conservative outlook in that regard. And in terms of High Functional Materials & Components as well as Automotive Systems, the assumptions must remain severe. But on the other hand, for the Social Innovation Business as well as Information & Telecommunications Systems and infrastructure industrial systems, Lumada's business as well as industrial areas and our digital solutions business are areas that we hope to expand going forward. Lumada-related business trend shows that we can have high expectations in this area. But we must achieve a higher level of profitability, which is akin to global competitors in terms of revenues as well as income. In order to do this, we'll have to make investment for business development as well as R&D investment for growth goal being required. And we will make a proactive investments in that regard. However, in terms of operations improvement, there are cost reduction in fiscal year 2018. They still materials were subject to increasing cost. And we have to -- we made progress in terms of cost disruption to absorb this increase. We will continue with this initiative, without slowing down and furthermore, utilizing our digital technologies operation improvement as well as quality. Losses from -- related to quality should be reduced. So operation will continue to be improved, improve cost structure and enhance our profitability. That is what we intend to do. The 2021 Mid-term Management Plan is what we are formulating today in the mid- to long-term strategy, and the numbers will be formulated and it will be shared with you in April.
I have 2 questions I would like to ask. Question number one, with respect to Horizon Project, in the third and fourth quarters, you're going to post impairment loss of JPY 300 billion, I understand that. But Horizon is not going to be dismantled as a project. You will keep some of the staff to continue with part of the activities. Next year and onward, what are the expenses expected for Horizon? You're going to suspend the project, but if you are to make a decision for withdrawal, are there contractual penalties that you may have to pay?
The expenditure going forward, as a one-off expense, we're going to book it in the fourth quarter, JPY 21 billion. That is what we are expecting to post in the fourth quarter. In terms of cash out, that the amount. So fourth quarter, this fiscal year, JPY 13 billion. JPY 8 billion in fiscal year 2019. In terms of PL, JPY 21.6 billion. The full amount is to be posted in the fourth quarter. We will not start production right away. In order to conserve the site, Horizon as a company will remain. And of course, maintenance cost will be involved, but it's going to be minimal. And if there are any contractual penalties, they will have to be put there. Beyond that, our assets are limited. Our land is about the only thing and the cash that will be necessary going forward. So those will be the assets, which are pretty limited. So there is no risk of additional impairment loss.
Does that mean that because of contractual violations in other areas or in terms of running costs, are you not expecting any further cost increase?
No, we're not expecting anything more.
My second question. With respect to Automotive Systems, there were problems with power supply to Subaru. Is that going to have a negative impact on your performance?
Automotive Systems, we are in the position of being a supplier to Subaru. So we cannot make any comments on this. Given our position, I would like to refrain from making comments.
So you're not going to post anything in the third quarter or the fourth quarter?
We are not planning to post anything from that.
Regarding the Automotive Systems business, I would like to ask further questions. In terms of operating income margin, 8% is hard to achieve, but you are selling business this fiscal year. With this, do you think that profit margin will improve? The business environment remains very difficult in this area. How -- what kind of initiatives are you contemplating to improve the situation? Now another question is the impact of U.S. and China trade war as well as Brexit. It is in a flux. Now what will be the impact on your business?
Regarding Automotive Systems strategy, currently, in the third quarter and in the fourth quarter, noncore business will be sold and we have decided on 4 -- of the 4 businesses. This is a selection and focus in terms of Automotive Systems business. And when you talk about focus, motors and inverters will be very important businesses as well as autonomous driving will be an important focus for us. We are not going to take a scattergun approach, but rather select the business that we will focus on so that we will make sure that we can secure position in the global market and that is what we are proceeding with and the decisions have been made this time accordingly. In terms of operational improvements, we are reviewing all types of costs in terms of procurement as well as other costs that have been identified, so that we can further reduce costs. In terms of profit margin, the impact of these measures have already come to the fore. In terms of operational improvement as well as well as selection of focus will be important for us to improve the profitability. We hope that the performance will be enhanced. And in terms of the mid- to long term, we will leverage our strength, so that global position can be secured and we will select such businesses to allocate our resources to. Now regarding the trade war between the U.S. and China. This is very difficult because there will be some products that will be directly impacted, but the direct impact is not very significant in terms of value. But as already explained in the past, the overall economic environment could slow down in countries in the world. We have to watch this trend very carefully. Regarding Brexit, on the other hand, the business is -- in the U.K. is the flagship business of rolling stock. And in the U.K., in -- the order backlog is very significant. Revenues are very significant, and we are concerned about the procurement cost, if there is to be a hard Brexit. But so far, in the U.K., we are trying to set up an organization, where we will have a closed loop in the U.K. and 70% of the products that we procure are procured within the U.K. Therefore, the impact is limited. In terms of dealing with the business, we have the plants in the U.K. as well as in Italy. Therefore, we can utilize these plants for flexible dealing with the situation.
Any further questions?
First, regarding Brexit, 70% procurement, is that to be raised in the future or will you keep 70% flat?
To the extent possible, we would like to raise the ratio of procurement that we can achieve within the U.K. So what can be sold in the U.K., we would like to increase our procurement of parts and components in the U.K. We are not sure how much increase we can achieve. I don't think we can achieve 100%.
About China, so decline in your Automotive Systems business. If you could be a little more specific. The number of elevators sold has increased, but then, on the other hand, Automotive Systems are down, that's because of the sales decrease or economic conditions locally?
I think they are both. The sales trends vis-Ã -vis the customers that we supply to, they're down. And overall, the sales revenue is also declining. They are both factors.
With respect to Lumada, SI business for Lumada, 98%, JPY 760 billion for the full year, so decline of 2%. Has that been the same from the initial forecast? I wonder why?
In terms of the trend, Lumada SI business, a part of the business is about Lumada being set up from scratch. So solution core business, that part is increasing. So a part of SI business is being replaced by core business. Therefore, SI business is expected to decline slightly. But over the medium to long term, Lumada core business will be the leader and Lumada SI business is also to be increased. That is our outlook. Thank you.
This will be the last question.
I have 2 questions. Regarding the automotive business, for next fiscal year, structural reforms is likely to have run its course in this fiscal year, so there will be not significant structural reform, but there is -- it will be subject to high volatility. But what about other businesses? In terms of structural reform, will there be a need to implement such measures in the next fiscal year? Second question. Can I continue with the second question? A release has been made regarding the strengthening of the organization. What -- why did you make this change? What were the challenges you were facing compelling you to make this change?
Regarding structural reform, AMS, the selling of the business is part of structural reform efforts. Therefore, it's a solution-focused strategy-based initiatives were implemented. And therefore, further structural reform will be necessary going forward to reduce cost as well as to -- in terms of products as well as changing the product portfolio, so that we can leverage our strength and that will be the core business for us. So in that regard, we will continue reorganization as well as structural reform. It's not just limited to AMS. But regarding other businesses, there will be structural reform as well as reorganization that will be required, then we will implement that in a steadfast manner. In all of the segments, we will continue to make such efforts. In all the segments, the withdrawal in terms of products or selling on the business have been conducted in the past, and we shall continue with this without exceptions. Based on the next Mid-term Management Plan, necessary measures will be implemented and it will be considered accordingly. Now to your second question regarding the business structure. For one, what we are trying to achieve is to become a global leader in social innovation under the 2021 Mid-term Management Plan. So we will be focused in such solution business. And in order to strengthen these business areas, we have reorganized. We have identified 5 areas of growth. In the past, there used to be 4. But now we have reorganized to mobility solution, human life solution, industry solution, energy solution and the IT solution. 5 areas have been identified so that we can allocate more resources for generating new values, and we will aim to become the global leader in each of these fields. Mr. [ Fukui ], Vice President, will be in charge of these -- of overseeing these 5 areas. In the past, investments were made based on business units, that was the prevailing trend. But now we will be looking at such initiatives in terms of clusters so that optimized investment as well as optimized resource allocation can be made. And above the BU, the Executive Vice Presidents will be in charge of these different areas and under the President. And by so doing, we will accelerate the Social Innovation Business under these Executive Vice Presidents in each field. And overall, the Social Innovation Business will be accelerated. The other point we made is diversity. To generate innovation, there will be more diversity focus in terms of non-Japanese executives as well as persons from outside of the Hitachi Group. Based on this perspective, allocation have been made. Thank you.
With this, I would like to bring this meeting to a close. Thank you very much for your attendance.