Thank you for participating in the investor meeting for the second quarter of 2025 results at Japan Tobacco Inc today, amidst your busy schedule. It is time. We would now like to begin the investor meeting. Before we start the meeting, we would like to ask you to make sure that your display name is accurate in order to facilitate the Q&A. Thank you for your cooperation. It is now my pleasure to introduce our CFO, Mr. Hiromasa Furukawa, please. Good afternoon. I am Hiromasa Furukawa, CFO of the JT Group. Thank you very much for coming to the investor meeting. I will begin by explaining our six-month consolidated results for the fiscal year 2025. Please see slide four. As shown on the slide, revenue and AOP increased strongly, both on a constant FX and on a reported basis. AOP at constant FX, our primary performance indicator, increased by an impressive 24.7% year-on-year, driven by a strong organic performance, boosted by the contribution of the Vector Group in the U.S., which we acquired last year. The foreign exchange impact on AOP remains negative due to the appreciation of the Japanese yen from the second quarter onward. This led to the depreciation of major currencies and of several emerging market currencies against the Japanese yen. Operating profit increased by 10.9% year-on-year, driven by the increase in AOP, partially offset by impairment losses related to the transfer of the pharmaceutical business and higher amortization costs of intangible assets related to the Vector acquisition, both of which were included in the adjusted items. Profit increased by 4.8% year-on-year, driven by the increase in operating profit, which exceeded higher financial costs and higher corporate income tax expenses. Moving on to the results of each business segment, starting with the tobacco business. Please see slide five for the volume performance of the tobacco business. Total volume, combining both combustibles and RRP, increased by 0.7% year-on-year. When excluding the unfavorable impact of inventory adjustments, mainly in Russia and Western Europe, total volume actually grew by 1.9% year-on-year. This solid volume performance, in the context of a global declining combustibles industry volume, was driven by organic growth and the inclusion of the volume from the Vector Group, which we acquired last year. Let me now explain the breakdown by product category. Combustibles volume increased by 0.3% year-on-year. The main driver of growth was the EMA cluster, where continued market share gains and an improved combustibles industry volume and the Vector Group inclusion delivered solid volume growth. In our other clusters, we also continued to gain market share, including in Taiwan and the U.K., mostly offset by lower industry sizes. This was mainly the case in the key markets of Japan and the U.K. RRP volume grew by a significant year-on-year increase of 20.2%. This was driven by continued growth in both volume and market share within the HDS category and markets where available. This RRP performance embeds the sales performance of Ploom AURA and EVO in Japan, which I will explain in more detail later. Moving on to the financial performance of the tobacco business on slide six. In the second quarter, we achieved double-digit growth in both revenue and AOP, driven by strong pricing contributions across multiple markets. Focusing on the AOP growth drivers, the volume contribution was positive, mainly fueled by the inclusion of the Vector Group, which also improved the market mix through higher margins. Regarding the Vector Group contribution, I can confirm that it has been in line with our initial expectation. The price mix contribution to AOP was very strong. Pricing contributions in many markets, including the Philippines, Russia, and the U.K., outweighed the lower product mix, mainly due to downtrading in Japan and the Philippines. These positive factors far exceeded the incremental investments toward Ploom and the inflation-led cost increases within the supply chain, including tobacco leaf and labor. As a result, AOP at constant FX increased by 23.1% year-on-year. As I mentioned earlier, the FX impact on AOP was unfavorable. Nonetheless, AOP in the first half came in strongly, fueled by solid pricing contributions applied to a favorable organic volume momentum. Slide seven reviews the performance of the three clusters in the tobacco business. The graphs on this slide show year-on-year variances in total volume, core revenue, and AOP at constant FX for each cluster. Let me start with Asia cluster, which includes the key markets of Japan, the Philippines, and Taiwan. Despite growth in the second quarter, total volume in the first half decreased by 0.4% year-on-year, mainly due to lower combustibles industry volume in Japan and Taiwan, partially offset by market share gains in several markets, including Bangladesh and Taiwan, and higher Ploom volumes in Japan. Regarding financial results, a strong pricing contribution in the Philippines outweighed the negative volume impact and lower product mix, mainly due to downtrading in Japan and also the Philippines. These factors resulted in higher revenue and AOP at constant FX. Turning to Western Europe, which includes the key markets of Italy, Spain, and the U.K.. Total volume decreased by 5.8% year-on-year due to lower combustibles industry volume in several markets, notably the U.K., as well as unfavorable inventory movements in Italy and Spain. These factors exceeded the positive share momentum in several markets, including Germany and the U.K., combined with continued Ploom share gains in the HDS segment. Core revenue and AOP grew as the pricing contributions, mainly in Italy and the U.K., offset the negative volume variance, mainly in the U.K.. Moving on to EMA, this cluster includes the key markets of Romania, Russia, Turkey, and the U.S. Total volume increased by 3.2% year-on-year, mainly driven by the inclusion of the Vector Group and market share gains in several markets, as well as an improved industry volume in Russia and Turkey. The cluster reported an increase in both revenue and AOP at constant FX, driven by the increase of total volume and an improved market mix from the inclusion of the Vector Group. Pricing contributions were also strong, mainly in Russia and Turkey. The robust top line growth across the board enabled each cluster to offset the incremental investment towards Ploom and inflation-led cost increases, including in the supply chain. Slide eight provides an update on the HDS share trends of Ploom in selected markets. As shown on the graphs, Ploom's share within the HDS segment is continuing to grow across the footprint. In Japan, HDS share of segment reached a 13.6% average in the second quarter. Our share gains are solid despite new product launches and intense promotional activities by competitors. Speaking of new product launches, on May 27, we launched our new device, Ploom AURA, along with Supreme Instex EVO in limited channels. I will provide further details on Ploom AURA's performance in Japan on the next slide. Outside of Japan, even though competition in each market was intense, our HDS share of segment continued to grow steadily. This is driven by the adjustment of our go-to-market approach, including the expansion of distribution networks, promotional activities such as collaboration with various events and use of pop-up stores, as well as marketing efforts leveraging digital media and online platforms. Slide nine explains the performance of Ploom AURA in Japan. In Japan, after the pre-launch at the end of May, we expanded the availability of AURA nationwide on July 1. We are very encouraged by the strong start of AURA and EVO Sticks. As you can see from the graph on the left, cumulative device sales of Ploom AURA have exceeded those of the previous model, Ploom X, by approximately three times in the first three weeks of nationwide expansion under the same conditions. This significantly surpassed our past sales records for HDS devices. Importantly, after the launch, cumulative device sales have continued to grow steadily. Customer feedback includes comments such as, "Product offers a stronger kick with a rich and satisfying taste," and "Design has become slimmer and more comfortable to hold," indicating high evaluations by consumers for the major renewal points of taste and design. Regarding the Premium Stick EVO, we have also received very positive feedback such as, "As expected from a premium brand, the flavor is rich and delicious, and it's worth purchasing even at JPY 550." As a result, as shown in the graph at the top right of the slide, HDS share of segment growth in Japan has accelerated since the launch of Ploom AURA and EVO. Going forward, we plan to expand the stick lineup and gradually roll out AURA in overseas markets, starting with Switzerland in September. These developments give us confidence in our ability to continue expanding our market share both in Japan and overseas and keep us on track to deliver on our 2028 RRP ambitions. Next, I will explain the results of the processed food and pharmaceutical businesses, starting with the processed food business. Revenue increased by JPY 2.9 billion year-on-year, driven by the positive impacts from price revisions this year and higher sales of packaged cooked rice in the frozen and ambient food business. However, this revenue increase could not offset higher raw material costs such as rice, resulting in an AOP decrease. Moving to the pharmaceutical business, revenue increased by JPY 4.3 billion year-on-year, driven by the sales increase in the area of skin disease and allergen at our subsidiary Torii Pharmaceutical and increased overseas royalty income. AOP was broadly stable as the revenue increase offset higher SG&A expenses. From the next slide, I will guide you through our revised forecast for fiscal year 2025. First, I'll explain our full-year consolidated revised forecast. Core revenue at constant FX has been revised upward by JPY 54 billion from the initial forecast, reflecting the strong first-half momentum in the tobacco business, as well as an upward revision of the revenue in the processed food business. While revenue in the pharmaceutical business has been revised downward due to the transfer of the pharmaceutical business, this impact is more than offset by the factors I just mentioned. As a result, we expect an 8.4% year-on-year increase in core revenue at constant FX. AOP at constant FX has also been revised upward by JPY 47 billion from the initial forecast, reflecting the upward revision of core revenue at constant FX. Consequently, AOP is expected to increase by 14.6% year-on-year. The negative FX impact on AOP is expected to ease versus the initial forecast due to a favorable revision of assumed foreign exchange rates. As a result, AOP on a reported basis has been revised upward by JPY 89 billion from the initial forecast. Operating profit has been revised upward by JPY 68 billion, reflecting the upward revision of AOP, partially offset by the adjustment tied to impairment losses related to the transfer of the pharmaceutical business. Profit has been revised upward by JPY 44 billion, driven by the increase in operating profit, partially offset by higher financial costs. Free cash flow has been revised downward by JPY 112 billion, despite cash inflows related to the transfer of the pharmaceutical business and the upward revision of AOP. This is due to the expected initial payment related to the comprehensive settlement of the Canadian litigations, which was not incorporated in the initial forecast, and higher working capital. Compared to the previous year, we expect an increase of JPY 65.5 billion due to the payment made last year for the acquisition of Vector Group. The following slides explain the revised forecast of each business. First, let's look at the volume forecast for the tobacco business. Total volume combining combustibles and RRP has been revised upward, reflecting the share growth in combustibles and the improved industry volume in several markets. In the second half, we expect total volume to decline year-on-year, mainly due to the lapping of the Vector Group acquisition in October. As a result, we're expecting total volume to decline by approximately 1% year-on-year. Turning to the financials. Core revenue at constant FX has been revised upward by JPY 80 billion, reflecting the strong pricing delivered in the first half. This will translate in a 9.8% year-on-year increase, including the lapping of the Vector Group acquisition. The robust top line performance will enable us to make additional investments in Ploom, resulting in AOP at constant FX being revised upward by JPY 42 billion. Consequently, AOP at constant FX is expected to increase by 13.4% year-on-year. In the second half, growth in core revenue and AOP is expected to moderate, reflecting a volume decline in the second half year-on-year and a higher cost base versus the first half. Although FX impacts are expected to continue to have a negative impact, the revision of assumed exchange rates is expected to reduce the extent of this negative impact compared to the initial forecast. Slide 14 explains the revised forecast for the processed food and pharmaceutical businesses. The forecast for revenue in the processed food business has been revised upward by JPY 2 billion from the initial forecast, incorporating higher sales of packaged cooked rice in the frozen and ambient food business. Forecast for AOP remains unchanged from the initial forecast, as the upward revision of revenue is to be offset by higher raw material costs such as rice. Moving on to the pharmaceutical business. The forecast for revenue in the pharmaceutical business has been revised downward by JPY 28 billion from the initial forecast, mainly due to the deconsolidation of Torii Pharmaceutical Company Limited from July this year, following the sale of shares in Torii. Higher overseas royalty income is expected to partially offset this negative impact. AOP has been revised upward by JPY 6 billion from the initial forecast, despite the downward revision of revenue, mainly driven by the exclusion of R&D expenses concentrated in the second half due to the deconsolidation. The pharmaceutical business is planned to be classified as a discontinued operation starting from the third quarter of this fiscal year. Please refer to Slide 18 for details regarding the corresponding disclosure changes. Finally, please see Slide 16. The first half results were very strong. The pricing contribution in the tobacco business was a significant driver of this performance, alongside the inclusion of the Vector Group, which contributed in line with our initial expectation. As a result, AOP at constant FX increased by 24.7% year-on-year, marking substantial growth. In HTS, our focus area, Ploom market share has been steadily expanding. We are also seeing strong momentum for Ploom AURA and EVO in Japan since July. As for the full-year forecast, we have revised upward all indicators from top to bottom line. This reflects the strong momentum in the tobacco business during the first half and the anticipated reduction in negative FX impact due to a revision of the FX rate assumptions. Finally, shareholder returns. This is the first time we are making this announcement in conjunction with second-quarter earnings release. Based on the revised forecasts and our shareholder return policy, we plan to revise the annual dividend guidance upward by JPY 14, from JPY 194-J PY 208. As I mentioned in the first-quarter results announcement, we determined the dividend for the current period based on the payout ratio calculated on the continuing operations basis. The payout ratio will be 74.9%, based on the figure which is shown on Slide 18. This concludes my presentation. Thank you very much for your attention. Thank you very much. We'd like to move on to the Q&A session. Let me introduce to you the speakers who will answer your questions today: Hiromasa Furukawa, CFO of the JT Group, and Nobuya Kato, JTI Deputy CEO. Now I would like to show you how to ask questions. Please click the raise hand button in the Zoom window. If you are selected, please unmute your microphone and ask your question. For participants joining by phone, please dial star nine to raise your hand. If selected, dial star six to unmute and ask your question. Due to time constraints, each person may ask only one question. Please note that we may not be able to answer all questions. Thank you for your understanding. Thank you very much for waiting. I would like to introduce the first questioner from Mizuho Securities, Saji-san, please. Thank you very much for the opportunity. It has been a very favorable result. I'm very happy. My question relates to the domestic RRP business. In three years, JPY 650 billion is the investment plan. A large portion of that, so Ploom AURA, the launch, is using a lot within that investment. My question is, three years and JPY 650 billion, this year, how much would you spend and what would you invest towards? Also, adjusted OP, that is the way you've been communicating to us. What is the potential expense increase, would it be that is related to AOP? Also, on a midterm basis, you're planning to turn the business into black as KPI. By 2028, for RRP as a whole, you're planning to turn this business into black. This year, inclusive of the deficit, what is the degree of the deficit you may have inclusive of all these expenses? Thank you very much. That question relates to RRP category, JPY 650 billion investment, and a breakdown by each year, and also its usage, and also impact on adjusted OP. Also, towards the 2028 ambitions, some of the outlook on a midterm basis. JTI Deputy CEO, Mr. Kato, would answer. Mr. Saji, thank you very much for the question. This is Kato. You mentioned domestic, so that was part of your question. As you know, JPY 650 billion in three years is not just for domestic, but also on a global basis. That is the amount that we expect to invest. Breakdown by each year, unfortunately, we do not disclose, but as a general trend, it shall be on the rise, because it would be more markets deployed with the RRP. For this year, next year, and the year after, at the end of this year into the first half of next year, in the existing markets, we will conduct a replacement to AURA. On a relative basis, this year and next year, perhaps somewhat investment is heavy on a relative basis. As part of your question, you mentioned about the breakdown of the investment, so you're talking not just by the year, but by which products, which I think was also part of your question as well. I would also like to explain on that part. Needless to say, new products development and also we may have R&D with the base, the insights, all those are inclusive in there. We talked about AURA, replacement to AURA, and various marketing and promotional activities are all inclusive in here. In terms of turning the business into black or profitable, as Mr. Saji referred, the year 2028 has been set as a potential milestone to bring the RRP business as a whole profitable. That is the midterm outlook. We would like to achieve those, and for the time being, again, we're just aiming breakeven and also making the business into profitable on a midterm basis. That is our first target. In order to achieve that, we need to have some sort of base to start from. At the same time, HTS especially, of course, HTS will be the primary category. Mid-teens is the segment share we are aiming for. We shall have a certain amount of size, the base size. Once we achieve the breakeven, we need to accelerate the contribution into the earnings. In terms of the time frame, you may wonder when can we actually have a recoup of the investment that has been made. Basically, on a midterm basis, first of all, the breakeven and making the business profitable. Of course, we need to have certain size as well. All these need to be taken into perspective. Beyond that, we would also need to accelerate the contribution into earnings development. On the long-term basis, perhaps a bit more on the longer tape is we would like to recoup the investment that we have made. That is all in terms of my answer. J ust one point to add on. In terms of adjusted OP, what is the potential expenses or costs that would hit the AOP? Because the investment amount is quite large, I believe some are concerned about the potential cost and expenses. The expenses that would hit the AOP, how much would that be for this fiscal term, roughly? For this fiscal term, I think that was the question. In terms of adjusted OP, what would be the amount that would hit the AOP? Maybe we cannot disclose the exact amount, but perhaps on a qualitative basis, I can give you some color. If we look, we don't have a number specifically for RRP. We cannot disclose that number specifically for RRP. For this fiscal term, on a full-year basis, in terms of AOP, on a current constant FX basis, 13.4% growth year-on-year is expected. By different, there are some positive drivers, and there are some negative factors, which would be the cost. Within that, where it says others, that is negative, and also it would be realized as cost. Perhaps we can give you the breakdown within this others. Within the others, we have the cost. The COGS accounts for about half of that within the others. The marketing cost, just short of 30%. OPEX, around 25%. That is the breakdown. The marketing expenses account for quite a large portion within the investment. Within the cost, it's just short of 30% in terms of marketing. Of course, these marketing, this relates not just to RRP, but also in markets where RRP is not deployed, that is for combustibles, we are also spending the market expenses as well. Again, just as a reminder, this is not just for RRP. This is not a direct answer to your question, but hopefully that would answer your question. Thank you very much. Saji-san, thank you very much. I'll introduce the next person. From Nomura Securities, Morita-san, over to you. This is Morita from Nomura Securities. Thank you for taking my question. Regarding shareholder return, I would like to receive additional comments from you. 75% was the shareholder payout ratio. You were commenting that you're comparing against other FMCGs. When you look at food companies and other companies of Japan, they are moving it up a step further when it comes to share buybacks and so forth. I think they're going up a level lately. When you look at your balance sheet, when it comes to shareholder return, I think there is a little bit more opportunity to do additional returns. When you think about total shareholder return, what are your views in changing it and making it higher? How do you view what others are doing? How do you view yourselves? The question was about our policy on shareholder returns. Our Group CFO, Mr. Furukawa, will take the question. Morita-san, thank you for your question. This is Furukawa, Group CFO. As you rightly said in your question, regarding shareholder return, the main part of our policy is dividend per share. Regarding the payout ratio, 75% plus minus 5% is what we have guided as a policy. First, regarding the payout ratio of 75%, we look at various peers and global FMCG companies. We have confirmed where they are through monitoring, and we look at and benchmark against our peers. We do believe our payout ratio is comparable to what they offer. Regarding allocation of cash, we do believe it's important to offer shareholder return, but it's also important to invest it into our business. We would like to strike a good balance between the two, and that is how we have derived the payout ratio that we currently offer. Regarding your question on share buybacks and its opportunity, up until now, we have been answering to that kind of question as well. Regarding share buybacks, it depends on our financials for that given fiscal year. On top of that, the business environment we're in, as well as where we are free cash flow-wise, as well as where our balance sheet stands, as well as our medium-term outlook. We will also look at our profit levels, as well as how much we're going to invest into our business. We look at a variety of factors to decide what we are going to do. Just to confirm, we look at the benchmark of dividend payout ratios. However, over the medium and long term, we want to sustainably grow our profits so that we can steadily increase shareholder return. I just have a follow-up question to that. Against your peers, what about total shareholder return? I think that's more relevant. When you look at total shareholder return of peers, the 75% dividend payout ratio, do you still feel that it's comparable to competition? Of course, we do engage in monitoring. When you look at numbers of targeted companies, we are inferior when it comes to total shareholder return. As we do comparisons against the companies we monitor, we will constantly confirm where we stand position-wise. At the same time, we will continue to obviously need to invest in our business as well. We would like to strike a good balance by looking at both. However, also consider shareholder return policies that are competitive. Of course, these are moving parts, and other companies will also change their policies as well. We would like to continue to monitor where they stand. Thank you very much. Thank you very much, Morita-san. I'd like to introduce the next question. JP Morgan Securities, Fujiwara-san, please. Hello, this is Fujiwara from JP Morgan Securities. Thank you very much. I have one question related to the tobacco business. On a constant FX basis, how should we look at the AOP going forward? You talked about the second half. It is not expected to grow that much, maybe just a slight decline in terms of the profit. You've explained that within the presentation, but I'd like to hear more details related to that. Also, for the business plan 2025, the business plan, so high single-digit growth is expected. This term, 13% growth has already been planned. Next year onwards, high single-digit growth. Could you realize this? Because it appears as if the base has been lifted. Next fiscal term onwards, if you can share with us your outlook. That is my question. The question was related to this year's and the remaining period. What is the AOP for tobacco business? Also, next year onwards, what are the outlook and the thoughts related to the earnings growth? Kato-san will give you the answer. Fujiwara-san, thank you very much for that question. The second half, we may see some deceleration. I'd like to again explain to you the factors. The largest factor, as you may be aware, is Vector Group's acquisition impact. The Q4 of last year that has been consolidated. Basically, it has been lifted and will be absent Q4 onwards for this year. That is definitely one of the largest factors. Of course, that would have an impact on the volume. Of course, beyond the volume, all the way to profit, it shall definitely pose the impact. In terms of pricing, the pricing effect, in the second half, we do expect to see a pricing effect as well. In terms of the pricing environment as a whole, we are not expecting major changes. We believe we can steadily implement the pricing strategy. In terms of volume, the first half is expected to be stronger. As a result, the pricing effect in the first half tends to be stronger in comparison to the second half. On a relative basis, the second half may appear to be weaker. This is just on a relative basis. Also, we've been talking about Ploom AURA. In the existing markets, we will continuously deploy Ploom AURA. The replacement will be proceeded more in the second half of this year. In relation to that, investment should grow in the second half. These are some of the factors we are expecting in the second half. Also, for next year, I think your question relates to the outlook for next year. 13.4% is this year's gross expectation. One of the major factors, as repeatedly mentioned, is the acquisition of Vector Group. Needless to say, this year, we shall see the full-year impact. Next year, we shall see an acquisition effect. Of course, the simple sort of a positive effect from the acquisition will be absent next year onwards. That is perhaps why Fujiwara-san is posing the question, what do we think of next year onwards. We are still in the midst of this year, so we cannot really comment on next year at this particular moment. Perhaps I can give you some explanation on a qualitative basis. 13.4% of a full-year gross expectation, this number, certainly, the Vector acquisition impact is inclusive in there in large portion. At the same time, organic contribution, organic growth has been very robust as well. That is the reason why we have set the guidance for 13.4%. Strong momentum is there, and we are hoping that this will be continued next year onwards. That is what we can share with you at this moment. Understood. Thank you very much. Thank you, Fujiwara-san. I'll introduce the next person. Morgan Stanley, MUFG, Miyake-san. Over to you. Thank you. This is Miyake from Morgan Stanley. I have a question about Ploom and its market share increase in Japan. I would like more color and on its backdrop. This time, the premium price range of EVO was also launched. You are also going to raise the prices of MEVIUS as well. Up until now, downtrading manifested in the RRP market, I recall. After the launch of EVO, in the RRP brands, how has the mix started to change? Do you think that momentum is sustainable? That's my question. The question was about HCS category share increases in Japan and the reasons why, and regarding the launch of EVO, as well as other brands and its mix change. How has it developed? Kato-san will take the question. Thank you very much for your question, Miyake-san. Regarding the launch of AURA, from the end of May, there was an initial limited distribution on a channel basis. After the Q2 launch, segment SOS became 13.6%. It increased, and because it was channel limited, the contribution for EVO is not that high. That's the way you can look at it. However, quarter by quarter, we have been growing the business. Prior to AURA, which was Ploom Advanced, we have been able to satisfy our customer base, Ploom X Advanced. Also, for the sticks, we do believe customers will continue to enjoy and be satisfied with the sticks. For MEVIUS and Camel, there has been a switchover from the beginning of this year. We've been making improvements of our sticks, whether it be the flavor or the kick, and those are the reasons why we have been able to steadily increase our share. From July, we launched AURA on a nationwide basis. As Furukawa-san explained in the presentation, when you look at July, segment share has been growing by approximately two percentage points. Looking at the two percentage point increase, our view is that because of the new AURA device, whether it be EVO or MEVIUS or Camel sticks, the flavor as well as the kick has become better due to the new device. I believe that has served as a positive. The new brand EVO has had a high level of interest from the customer base, which has led to the growth, we presume. In terms of mix, we are not able to go into detail, unfortunately, but as of the month of July only, for MEVIUS as well as for Camel, our view is that there has not been a significant amount of cannibalization with EVO and its launch. Regarding EVO, because it was a new brand, marketing-wise, we are running various promotions and campaigns to promote trials of the user base, and that has had an impact on EVO sales in the first month. We have been receiving high levels of interest. Hereafter, whether it be for EVO or for AURA, by having our customers use AURA and how much that's going to contribute to share growth, we only have completed the first month, so we need to continue to monitor the trends. As a first month of the launch, our view is that we are off to a very good start. When you hear customer feedback, there's a lot of positive, extremely positive feedback so far. We are feeling good response from this launch, and we have high anticipations towards the future. We are deepening our confidence. I think you also mentioned this in your question, but going forward for Mevius, with the price increases that we are going to do for Camel, Mevius, and EVO, there will be three price ranges available. I'd like to talk a little bit about the way we look at our portfolio. Broadly speaking, price range-wise, we would like to have different brands be allocated in a balanced way so that we can enhance our profitability. We would also like to respond to a diverse range of customer demand. That's the sort of portfolio we would like to build by having these brands in place. To go into further detail for Mevius, including RMC, many customers support Mevius. It's popular, and also up until now, it has continued to be loved by customers because of its flavor and quality. We would like to continue to succeed those properties as we extend the lineup of products. Amongst the three brands, it will be in the middle in order to cater to extensive preferences of the customer base. For EVO, this is a dedicated brand for HTS. It has been the first time ever for JT to do this. Also for AURA, you are able to have a very rich and flavorful experience. We have adopted extremely high-end quality tobacco leaves, so it's HTS, AURA dedicated as a brand, and we are able to deliver high quality through this brand, reflected in its price point. For Camel, it's in the value-price range category, so the prices are affordable, but on the other hand, we don't compromise when it comes to flavor and quality. In this regard, we have three brands under three price categories. By having this kind of different positioning, we are able to communicate different types of features and characteristics so that the customers can enjoy based off their preference. That's the kind of optimal portfolio we would like to build, and by doing so, we would like to enhance our share. Thank you very much. I just have a follow-up question to that. By rolling out AURA and launching EVO, what kind of users are you anticipating? Are they coming from competition? Are they coming from combustibles, and are they converting as well? According to our data, as you rightly said, competitor HTS users have been captured. Also, combustibles users, including competitor combustibles users, have been coming as well. Whether it be for the AURA device, the segment share has been increasing, although it's just the first month, which we believe is proof that we have been able to capture share from competitor HTSs. It is very encouraging because the data matches with our internal data, so we have been deepening our confidence. Thank you. Thank you very much, Miyake-san. We'd like to move on to the next question from Goldman Sachs. Miyazaki-san, please. This is Miyazaki from Goldman Sachs. Thank you very much for the explanation. My question relates to the bottom line and the free cash flows. I'd like to ask about the line items closer there. In comparison to Q1, the adjusted OP or the operating profit, and related to that, the earnings power for net income, I think there has been an improvement in comparison to Q1. Were there any changes in terms of the line items, the financial cost or tax, and so forth? Has there been an improvement that has played a positive impact on the bottom line? Would this continue into the second half of the year? It is a confirmation on those line items. Also, on the full-year basis, free cash flow has actually risen in terms of—oh, no, sorry. It's free cash flow itself, actually, you've revised it down on a full-year basis. I think you mentioned about the increase in the working capital. What exactly caused the rise and what is expected to raise the working capital? That is an additional question to you. The question relates to the first-half results, the line items below operating profit, the details related to that, and also free cash flow, the full-year guidance, especially relates to the working capital. Furukawa-san would respond to your question. Thank you very much for the question. I think there are two questions inclusive in there. First is the items below operating profit. In comparison to Q1, you mentioned about the comparison, there's an improvement in comparison to Q1. In terms of the tax burden, in comparison to Q1, the burden is less in Q2. Q1, I think it was close to 30% in terms of the tax rate. I think I mentioned that as we progress through the quarter, this burden shall come down. That is definitely one impact that we have seen in Q2. Also, in comparison to last year, there is some interest, the cost related to Vector acquisition. Perhaps if you were to compare it with Q1, you may have that impression. As to the cash flows, free cash flows, that is, within the revised forecast, because of the settlement in the Canadian litigation, there were some initial payments related to the litigation. We expect to make that payment within this year, and that is why we are expecting the free cash flow. We have revised down. In terms of the increase in the working capital that is related to the non-tobacco materials, the NTMs, we have a lot of inventory. This relates to our sales strategy, so that has led to an increase in the working capital. That is all for me. Thank you very much for that. Thank you, Miyazaki-san. We are drawing close to the close. The next person will be the last question. From SMBC Nikko Securities, Furuta-san, please. This is Furuta from SMBC. Thank you for taking my question. I have a question about your revised forecast as well as about the dividend increase. You were saying that the second half is going to be moderate, but after the end of Q1, you were saying that the profit growth rate is going to moderate and cost will be incurred. The second quarter, on a constant currency basis, we saw profits still increase with momentum. I kind of feel that your second-half expectations are a little bit conservative. I do understand about the lapping effect as well as investment costs, but are you being wary of something else? Also about dividend increases, for the first time, you increased dividends as of the second quarter. That's what you said. Is there a change in policy? Why did you make these announcements at this timing? The current question was about the tobacco business and the second-half expectations. First, Kato-san will give his view. For the second half of the year and the moderation or the deceleration that we explained earlier, you were asking about if we are accounting for any other risks on top of what we explained. I think that's what you're trying to get at. When it comes to specific risk factors and accounting for them that we didn't explain, no, that is not the case. Regarding some areas that we didn't cover extensively, it is about volume. We were just talking about Vector, but in the first half of the year, for some markets like Turkey or Russia, total industry volume was extremely brisk. We explained that in the first quarter as well. In the second half, we've been doing pricing, and there have been some tax increases as well. For the second half of the year, we expect industry volume compared to the past to be a little bit slower, and it's likely to decelerate. That's our assumption. Furthermore, for markets like Bangladesh, as of last year in the second half, latter half, we launched some new products, and that impact has come through substantially in the first half of this year. For the second half of the year, on a year-over-year basis, we're going to be comping against the higher half, so it's going to be slower. Regarding volume, it's not just the Vector effect. We're expecting various factors, and that is why we anticipate a deceleration. You also said our outlook may be conservative. In other words, that would also mean that the trends of industry volume for the second half, if it becomes stronger, of course, we're not ruling out that possibility. We haven't accounted for that in our assumptions. There may be a chance that industry volume continues to be brisk for the second half of the year. If that materializes, for sales volume, it should become stronger than what we expect. In turn, the second half will come out to be stronger, which will be reflected onto our bottom line. Regarding risk factors that we haven't accounted for, if I were to mention some, one would be tariffs in the U.S., for they are having negotiations with countries around the world, and we are starting to gain visibility, whether it be for Japan as well as for the EU. However, the talks are not over yet. Also, for import tariffs into the U.S., although that has been decided, what is going to happen to exports out of the U.S. going to regions and countries around the world is also uncertain at this moment. There is a lot of uncertainty still out there, which may be a risk on the cost side of things, and there may be some negative items that may come through. However, we are also conducting various types of simulations on our side as well. Regarding things that are related to U.S. tariffs, we have accounted for that kind of impact by a certain degree in our forecast this year. As we run various simulations, unless our forecast is really off, we should be able to achieve our projections. That is it regarding the outlook for the second half of the year. Next, regarding our view on the revised dividend forecast, Mr. Furukawa will take that question. Thank you. This is Furukawa. As you rightly said, for us, as of the second quarter, announcing a dividend increase is probably the first time ever. As of the second quarter earnings announcement and revising up our dividend forecast, one thing that I mentioned in the presentation was that we saw strong performance of the tobacco business that we accounted for for the first half. Also, we revised the FX assumptions, and we expect the negative impact from FX to become smaller than before. That is why, based off net income, we decided to revise up the dividends. The payout ratio is 75% plus minus 5%. Because the revised forecast, when applying the payout ratio, the dividend goes both. Oh, the 75% target. We looked at current business conditions as well as the strength of momentum, and we deemed that achieving the target is high. Therefore, we decided to revise up the dividend payout forecast as of the second quarter. We talked about revising up the net profit outlook, and this is on the back of strong business performance. Of course, it's still in the middle of a fiscal year, so going forward, if there is a substantial change, which we cannot rule out, in that case, like mentioned earlier, the 75% plus minus 5% will be what we will refer to when we decide on our dividend payout. The outlook we set forth today is what we would like to achieve by making efforts throughout the remainder of the year. Thank you very much. I have a follow-up regarding the business. You mentioned tariffs as a risk factor. Is there anything that has impacted consumption behavior? Even indirect impact would be fine, but what have you acknowledged so far? This is Kato speaking. So far, indirectly, because tariffs have increased, prices have been increasing. When it comes to affordability or consumer sentiment and negative impacts and so forth, that's what we would call as indirect impact. At this point in time, we have not seen that kind of impact materialize in a big way. However, when it comes to consumer sentiment. You need to look at the trends over a longer period. When the sentiment starts to become negative, consumers will start downtrading or they may hold back from making purchases. We need to continue to closely watch the trends. As of right now, we have not confirmed any big movements so far. Thank you. Thank you very much, Furuta-san. With that, we would like to conclude the Q&A session. For FY 2025 Q2 investor meeting, we would like to conclude at this moment. Thank you very much for your participation.