Good afternoon. Thank you very much for joining us in the conference call on Asahi Kasei Corporation's earnings for the second quarter of fiscal year 2021. This is Futoshi Hamamoto from Investor Relations, serving as the moderator. We will begin with a presentation from Koshiro Kudo, CFO. After that, we will take questions. Other participants from Asahi Kasei are Yozo Sato, Corporate Accounting and Control. Takuya Takahashi, Basic Materials Strategic Business Unit, or SBU. Nobuhiro Yamaguchi, Performance Products SBU. Hiroaki Sugiyama, Specialty Solutions SBU. Eiji Ishikawa, Specialty Solutions SBU for Separators. Izumi Kawata, Asahi Kasei Microdevices Corporation. Kensuke Sakai, Asahi Kasei Homes Corporation. Ryuji Kibe, Asahi Kasei Pharma Corporation. I now give the floor to CFO, Mr. Kudo. Good afternoon. This is Kudo speaking. I will go over the results for the first six months and the forecast for the full year for fiscal year 2021. Page two, I will just hit on the highlights here. Net sales, operating income, ordinary income, and net income were all at record highs for a first half during this first six months. In addition to the recovery in Materials, Healthcare managed to overcome decline in ventilator shipments to maintain the same level as in the previous year. FY 2021 is expected to be the best year ever in all terms from net sales to net income. Based on the strong performance in the first half, we have made upward revisions to the full year forecast announced in May. Regarding shareholder returns, we expect to pay interim dividend of JPY 17 per share, and an annual dividend is forecasted at JPY 34, which will bring the cumulative dividend payout ratio to 38.3% for fiscal years 2019 through 2021, the three years under the current medium-term management plan. Next, page five, summary of major financial results for the first six months. Net sales, JPY 1,181 billion. Operating income, JPY 113.1 billion. Ordinary income, JPY 119.2 billion. Net income attributable to owners of the parent, JPY 91.3 billion, representing significant increase in sales and profits from the same period of the previous year, which was seriously affected by COVID-19. These results were almost in line with the forecast made in August, except for net income, which was significantly higher with partial booking in the first half of tax expense reduction originally forecasted for the second half from the reconfiguration of Veloxis Pharmaceuticals, Inc.'s organizations. The amount was JPY 8.2 billion. Earnings per share was JPY 65.79, and dividend per share was JPY 17. Next, page 6, sales and operating income by segment, year-on-year comparison. For your reference, the sales and operating income for the first half of FY 2019 are also posted on the far left. Materials posted significant increase in both net sales and operating income on recovery in demand to exceed the results for the pre-COVID first half of FY 2019. One factor is the increase in shipments due to the significant recovery in the automobile-related markets. In addition, the petrochemical market prices rose sharply against the backdrop of a recovery in demand. In addition, there was growth in high value-added business, such as electronic materials and ion exchange membranes. In Homes, although the number of deliveries decreased in the condominium business from the strong level in the previous year, strong performance in the U.S. business and consolidation of the Australia business brought about increase in sales and profit. Healthcare maintained the previous year's level in net sales and operating income, despite a decline in ventilator shipments from the year ago period, which saw a surge in demand owing to strong performance of mainstay businesses in critical care, such as defibrillators, as well as firm performance of pharmaceuticals and medical devices. Next, net sales and operating income by segment compared to the forecast made in August. While sales were generally in line with the previous forecast, operating income exceeded the forecast due to reduction in fixed costs and difference in timing. As for material, sales were slightly lower than the forecast due to the greater than expected impact of the reduction in automobile production due to semiconductor shortages. The operating income was on par with the forecast, partly because the market prices for petrochemicals, particularly AN, acrylonitrile, did not fall as much as expected. Homes and healthcare were generally in line with the forecast. Operating income exceeded the forecast due to the strong performance of the U.S. business for homes and some of SG&A expenses in healthcare being deferred to the second half. Moving on to the consolidated statements of income. Gross profit was JPY 386 billion, and the gross profit margin was about the same year-on-year. SG&A expenses were JPY 272.9 billion, an increase of JPY 27 billion due to increased expenses for logistics and R&D as an effect of newly consolidated companies such as McDonald Jones Homes Pty Ltd. Operating income was JPY 113.1 billion with operating margin of 9.6%, an improvement of 1.8 percentage points. Nonoperating income was JPY 6.1 billion, an improvement of JPY 5.4 billion year-on-year, with improvement in equity and earnings of affiliates due to improved performance at PTT Asahi Chemical Company Limited, which produces AN in Thailand. Extraordinary income and loss was effectively net zero, with a gain of JPY 8.1 billion and a loss of JPY 8.2 billion, including gain on sale of investment securities from the sale of strategic shareholdings and recording of business structure improvement expenses related to alternative semiconductor production following the fire incident. Income taxes were JPY 26.8 billion, up JPY 3.7 billion year-on-year. While there was an increase in taxes due to increased profits, there was a reduction in tax expenses associated with the reconfiguration of Veloxis's organizations. Net income was JPY 91.3 billion, an increase of JPY 44.5 billion year-on-year. Next, consolidated balance sheet. Comparing the end of March 2021 and the end of September 2021, total assets increased by JPY 126.5 billion. In addition to the recording of goodwill and intangible assets associated with the acquisition of Respicardia, Inc., there was an increase in accounts receivable with recovery of sales. Liabilities increased by JPY 43.8 billion, with interest-bearing debt increasing by JPY 37.5 billion and accounts payable increasing due to higher feedstock prices. Net assets increased by JPY 82.8 billion as a net result of a decrease in retained earnings due to dividend payments and the recording of net income. The debt-to-equity ratio was 0.45, keeping within the target range of around 0.5. Slide 10 describes cash flows. Net cash provided by operating activities was an inflow of JPY 76.7 billion. While pre-tax income increased year-on-year, working capital, such as accounts receivable, increased as sales recovered, and the net cash inflow therefore decreased. Net cash flow from investing activities was an outflow of JPY 91.6 billion. M&A-related cash outflows were almost unchanged from the same period last year. Last year, it was about the automotive fabrics business of Adient. This year it is about Respicardia and McDonald Jones. The result in free cash flow was a net outflow of JPY 14.9 billion. Net cash flow from financing activities was an inflow of JPY 6.3 billion even after dividend payments due to fundraising. The balance of cash and cash equivalents at the end of September was JPY 209 billion. From here, let us discuss the full-year forecast. Let us turn to slide 12. For the full year of FY 2021, we now expect net sales of JPY 2,453 billion. The operating income forecast is JPY 100 billion for the second half and JPY 213.1 billion for the full year. Full year ordinary income forecast is JPY 222 billion, and net income attributable to owners of the company is forecast to be JPY 185.5 billion. All figures from net sales to net income would be new record highs. For operating income, FY 2018's JPY 209.6 billion is the highest so far. Substantial year-on-year increase in net income is expected due to reduced tax expenses associated with the reconfiguration of Veloxis's organizations for an amount of JPY 24 billion. This has been factored in from the initial forecast. Slide 13 describes the sales and operating income forecast by segment in comparison with the same period previous year. The leftmost column shows FY 2019 figures for reference. There was significant impact of COVID-19 in the previous year, particularly in the first half. In comparison, we expect significant increase in sales and operating income this time. For material, we expect both sales and operating income to increase thanks to recovery in demand in each market and a rapid rise in petrochemical market prices centered on the first half. For homes, we also expect sales and operating income to increase after the consolidation of operations in Australia and strong performance of the U.S. business. For healthcare, we expect sales to increase, but operating income to decline. The healthcare business category is showing firm performance. Within critical care, while core businesses such as defibrillators remain strong, shipments are down for ventilators after that surge in demand last year. Slide 14 explains how the forecast has been revised from that announced in May. We have upward revised forecasts for all three segments, and especially material after firm performance in the first half. The rest of the slide is what I have already discussed, so rather than dwelling on that, I would like to highlight other points that may be of interest from the appendix slides. Let us first look at slide 25. Slide 25 describes overseas sales, which accounted for 49.1% of the group total sales in the first half. Most notably, the percentage of overseas sales for homes has increased to 18.4% from only 2.5% a year ago. For material, the percentage increased from 53.9% to 61.2%, reflecting demand recovery outside of Japan. We expect the overseas sales percentage to stay at around 50% for the time being. Next, let us go to slide 27. Slide 27 describes CapEx depreciation and amortization, as well as R&D expenses. We expect depreciation and amortization, excluding amortization of goodwill for the full year to come to JPY 121 billion. As written at the bottom of the slide, amortization of goodwill in the first half amounted to JPY 13.7 billion, and we expect around JPY 30 billion for the full year. This means full year total depreciation and amortization, including goodwill of around JPY 150 billion. With operating income of above JPY 210 billion, the full-year EBITDA would come to around JPY 360 billion. Let us now look at Slide 41. As mentioned at the beginning, FY 2021 is the final year of the 3-year medium-term management initiative. The table on Slide 41 shows half year operating income figures throughout the 3-year period from FY 2019. The medium-term operating income targets we initially set for FY 2021 were JPY 150 billion for material, JPY 75 billion for homes, and JPY 56 billion for healthcare. Within material, for basic materials, the focus has been on improving profit stability and reducing volatility. Around 90% of contracts for AN now adopt formula-based pricing that factors in feedstock costs. For performance products, we are reviewing the supply chain for automotive related products. We are also reviewing each product from the perspective of applications and development so as to improve profitability. Specialty solution business has continued steady growth since FY 2019, even during the pandemic, with an operating income of JPY 34.8 billion in FY 2020, and a forecast of close to JPY 40 billion for FY 2021. The growth drivers are electronic materials and separators. We will continue to focus on such high-performance differentiated products for growth. With regard to homes, operating income may fall short of the JPY 75 billion medium-term target by about JPY 6 billion. After that significant impact of COVID-19, however, there is now recovery in orders for order build homes. Domestically, our focus is on improving profit margins and transforming our marketing approach for order build homes as orders are coming through different channels than before. The focus for overseas businesses is to get to stable growth. Operations in Australia and the United States are geographically and strategically very focused and look set to be solid earnings contributors. We are now aiming to achieve the medium-term target figure just 1 year later. For healthcare, while figures went up and then down in relation to a surge in demand for ventilators, particularly in the first half of FY 2020, aside from that, underlying growth has continued. Operating income was JPY 43.5 billion in FY 2019, and the forecast for this year is JPY 59.5 billion, which exceeds the medium-term target of JPY 56 billion by JPY 3.5 billion. Even in the face of the pandemic, the segment greatly contributed to consolidated group earnings and at the same time proactively executed M&As. In the new medium-term management initiative that begins in the next financial year, healthcare will surely be positioned as a key growth driver. This concludes my presentation. Thank you very much for your attention. We will now take questions. I have a question on Materials, Performance Products and Specialty Solutions. What were the reasons for the decline in profit from Q1 to Q2? Also, how do you see the second half, including the impact of reduction in automobile production and semiconductor shortages? First, changes from the first quarter to the second quarter in Performance Products. One factor is the time lag in reflecting higher material prices in the selling prices. While raw material prices soared from the first quarter to the second quarter, some products had yet to have them reflected in the selling prices. There also was a factor of fixed costs tending to increase at the end of each half year. Profit fell from the first quarter to the second quarter, mainly due to those two reasons. As for the projection for the second half, we expect that the terms of trade will improve and recover. In addition, while the impact of the reduction in automobile production, particularly in North America, was felt in the first half, we expect a recovery in the second half, albeit gradual. With that expectation, we are projecting profit to improve in the second half. Profit declined from the first to the second quarters, partly owing to the advanced shipments from the second half to the first half. Overall, semiconductor market remained strong in the second quarter, and sales of functional coating materials for automobiles were also strong. As for lithium-ion battery LIB separator, slowdown in Chinese smartphones affected consumer electronics applications, while automobile production adjustments due to semiconductor shortages affected automotive applications. In addition, there were impacts on all businesses of increase in raw material costs and logistics costs, as well as changes in products, product mix. Due to these factors, profits decreased quarter-on-quarter. From the first half to the second half, profits are expected to decline in Performance Materials, Separators, and Electronic Devices. Performance Materials expects strong shipments overall, including electronic materials for semiconductors on one hand, but also rather serious impact of soaring raw material prices and an increase in fixed costs related to equipment operating in the second half and scheduled maintenance and repairs, hence lower profit. Separator business expects strong shipments continuing for automotive applications, while consumer electronics applications expect impact of seasonal factors and slowdown in Chinese smartphones. Added with regular price revisions in January and soaring raw material costs and logistics costs, we expect a slight decline in profit. Electronic devices expects shipments to remain strong, but due to increase in expenses related to outsourcing, profit is projected to decline. My next question is on critical care. Even considering the positive effect felt in Q1 from accounting treatment associated with the acquisition of Respicardia, sales and profit in Q2 seem too low. What were the reasons? Also, could you talk about the factors behind the projected decline in profit from the first half to the second half, including the impact of the acquisition made by ZOLL? Hamamoto from IR will take that question. From Q1 to Q2, while recovery trend continued for conventional defibrillators and LifeVest wearable defibrillators, shipments decreased for both quarter-over-quarter. Another factor was, as you indicated, the one-off positive impact in Q1 of accounting treatment associated with the Respicardia acquisition. Also, G&A expenses increased in the Q2 period due to the recovery of sales activities. From the first half to the second half, profit is expected to decrease by JPY 5.6 billion, despite steady growth expected for defibrillators and LifeVest. The accounting treatment of Respicardia will account for over half of that projected decline in profit, as explained at the first quarter earnings briefing. The rest are the combination of many factors. One is the increase in R&D expenses. Another is the cost factor of defibrillators. Last year, increased production of ventilators served to lower the unit production cost of defibrillators due to common cost. During the first half of this fiscal year, shipments were made from those low-cost inventories. That would no longer be the case in the second half. Thus, the difference. Another factor is new consolidation. Once the acquisition process of Itamar Medical Ltd. is completed, it will be consolidated, but we do not expect its profit contribution in the second half of this fiscal year. Due to these factors, we are projecting profits to decline from the first half to the second half. I have a question on basic materials. You indicated that about 90% of your contracts for acrylonitrile are based on price formula that reflect feedstock prices. Can we assume then that the current profit level of Basic Materials will be sustained since only small portion of your business would be exposed to price volatility. Just about the only thing to consider is the impact of inventory valuation gain and loss. My question is on the impact of price volatility in the basic materials business. Takahashi from Basic Materials. What that 90% referred to was the proportion of transaction agreements contracts in which cost factors are incorporated in the price formula to a certain degree. For example, 50%, which helps to alleviate the impact of price volatility. Can you give us a sense of the degree of impact alleviation? It depends, but generally speaking, the impact of changes in the feedstock price is maybe reduced to half through these arrangements. How about setting upper bounds and lower bounds to the price spread? Do you have those contracts as well? Yes, there are such contracts, but not all. Through those arrangements, we are trying to stabilize profit by reducing the cost impact as much as possible. I see. I hope that helps to clear the current concern over the narrowing of AN price spread. My next question is on homes. Usually, deliveries of order-built homes are concentrated in the fourth quarter every year. Based on your full year forecast, I don't see much difference between the first half and the second half. I presume it's mostly in relation to your overseas business and soaring raw material and fuel prices, especially steel prices. Do I take it that you are making conservative assumptions for the second half? Can you comment on that in relation to your earlier remarks that you hope to achieve the final operating profit target under the medium-term plan one year behind schedule in FY 2022? This is Sakai from Homes. In terms of the first half versus the second half, one big factor is the new accounting standard for revenue recognition that is applied starting from this fiscal year, FY 2021. That is the factor improving the balance between the first half and the second half in the order-built homes business. Raw material prices will have a significant impact in FY 2021, but we are working to improve profitability by reducing costs and improving productivity toward fiscal 2022. We are making efforts so as to achieve the final profit target in the current medium-term management plan in FY 2022, one year behind schedule. I see. Today, steel prices are soaring. Do I take it that you have means to hedge that through internal self-help efforts, the self-help efforts, and by raising the unit price at the time of new product launch? Yes, you are correct. We are doing both. My first question is the usual sales volume index for LIB separator. What was it in the first half? Also, a battery manufacturer is being sued for huge damages in relation to the recalls of electric vehicles, and there are reports that separators are to blame in some cases. So I'm wondering whether you are experiencing an increase in order inquiries as a supplier of high-quality separator. Also, given that Korean battery makers are moving to build factories in the U.S., I'm wondering whether Hipore production in the U.S. is likely sometime in the future. Ishikawa from Separator Business. First, the volume index in the first half of FY 2021 was 455. Regarding the impact of EV recalls, we are not seeing a particular increase in customer inquiries in relation to the recalls of electric vehicles at this point in time. Suffice it to say that the high quality of our products is well appreciated and recognized by our customers. Regarding production in the U.S., yes, we are aware of the plans by the Korean manufacturers, but we already have Celgard production site in the U.S. for the dry process LIB separator. The question of where and when to expand operations is being discussed and considered as we speak. A follow-up question. I think the sales volume of LIB separator in the first half increased by about 17% year-on-year. In terms of wet process versus dry process or by applications, how did they compare? Also, what is your outlook for the full year? In the first half, dry process separator slightly decreased for ESS, energy storage system applications, but increased for automotive applications. Wet process separator sales remained very strong, and especially in Q1, sales for smartphones in China increased significantly. Wet process separator was very strong in the first half. Regarding the full year outlook, although there are concerns over the impact of semiconductor shortages on automotive applications, we believe it will be almost on par with the May forecast. Second half growth is generally limited due to seasonal factors in consumer electronics applications, but our plan is to secure growth on a full year basis. My second question is about critical care. First half results exceeded plan, and you also upward revised the full year operating income forecast by JPY 5.5 billion. This despite the impact of the acquisition of Itamar. What products are driving performance? Conventional defibrillators? LifeVest? The first half results exceeding forecast and the upward revision for the full year are thanks to better than expected recovery of both conventional defibrillators and LifeVest from the decline due to COVID-19. There are other factors such as the negative impact of the weaker Japanese yen and the positive impact of accounting treatment associated with the acquisition of Respicardia. Fundamentally, it is that the core businesses are recovering steadily. Thank you very much. My first question is about the healthcare business category. Regarding the second half forecast, while you expect net sales to increase, operating income is decreasing to JPY 10.1 billion from JPY 12.1 billion in the same period last year. Can you tell us why? For pharmaceuticals, in the second half compared with the same period a year ago, shipments are expected to increase, but operating income is expected to decrease due to expenses associated with in-licensing and increased expenses for online activities by medical reps. While on the one hand, we are trying to control fixed costs, we are also aggressively investing where necessary for the future. With regard to medical devices, we expect net sales to increase on the back of shipment growth for Planova virus removal filters and a weaker yen. Operating income, however, is expected to decrease in a similar way to pharmaceuticals as activity-related expenses and R&D expenses are to increase. What about Veloxis? How would the second half compare against the same period previous year? We expect year-on-year sales growth for ENVARSUS XR immunosuppressant. Thank you. My next question is about Specialty Solutions. In the first half, you booked expenses for alternative production in relation to the fire at your semiconductor plant as extraordinary loss. Will the same be true for the second half, or will such expenses now be recorded as operating expenses? In the first half, we booked expenses for starting up alternative production as extraordinary loss. From the second half, we plan to book such expenses as operating expenses. How much would that be? In the first half, you booked JPY 5.1 billion in business structure improvement expenses within extraordinary losses. Do you mean that amount is reflected in the operating income forecast for specialty solutions? Not exactly, because that figure for business structure improvement expenses includes other expenses, not just costs associated with starting up alternative semiconductor production. If so, can you tell us how much of such costs you would book as operating expenses in the second half? I'm afraid I cannot provide further detail. I see. Thank you. My first question is about homes. On slide 31, it says operating income for overseas businesses, et cetera, came to JPY 5.7 billion in the first half. According to Asahi Kasei Homes, the initial forecast was JPY 4.8 billion for the full year, so you have already exceeded that. What caused this? Also, according to Asahi Kasei Homes' latest disclosure, the full year operating forecast is JPY 8.7 billion, which suggests lower operating income in the second half than the first. Can you tell us why? Operating income in the first half increased by JPY 5.3 billion from the same period last year. This is thanks to new consolidation of the Australian business and strong performance of the U.S. business. The expected decline in operating income in the second half compared with the first half is mainly related to the U.S. business. In the first half, lumber prices soared, and that was reflected in sales prices to some extent, but that situation is expected to normalize in the second half. Are you saying that first half results for the U.S. business were exceptional? Are you lowering sales prices in the second half? The first half was certainly exceptional. We will keep monitoring the situation in the second half. My next question is on the balance sheet. In your financial summary within inventories, work in process decreased significantly, while merchandise and finished goods increased. Can you tell us why? The decrease in work in process is due to the application of the new accounting standard for revenue recognition, which mostly affected homes. While the increase in merchandise and finished goods is due to higher market prices and inventory increase for material. For homes, the new standard for revenue recognition pushed inventories down while pushing accounts receivable trade up. For the group as a whole, the change in revenue recognition reduced inventories by approximately JPY 50 billion and increased accounts receivable by about JPY 25 billion. Thank you. First, on acrylonitrile, can you tell us about the price and spread during Q2 and your assumptions for the second half? How do you see the supply-demand balance going forward in light of power shortage in China and capacity expansion by other suppliers? There were reports suggesting that you will restart idled capacity at your Korean subsidiary, Tongsuh Petrochemical Corporation Ltd. Can you tell us more about that? And for that additional supply, would you also apply formula-based pricing that factors in costs? Q2 price averages were $2,267 per ton of AN, $1,005 per ton of propylene, for a spread of $1,262 per ton. The spread was not squeezed as much as expected and was wider than $1,100 per ton that we assumed in the previous forecast. For the second half, there is still uncertainty with regard to the impact of China's environmental regulations. AN is currently traded in the market at slightly above $2,200 per ton. For Q3, we are assuming $2,200 per ton. For Q4, we are assuming $1,800 per ton, as we expect supply-demand balance to relax with new supply coming online from capacity expansion at other suppliers. Propylene is currently traded at around $1,050-$1,100 per ton. We expect it to remain at this level during the second half due to high crude oil prices. Our assumption for the second half is $2,000 per ton of AN, $1,050 per ton of propylene for a spread of $950 per ton. With regard to China's environmental regulations, this is affecting production not only of AN, but also of ABS resin, which is one of the main applications for AN. We need to keep an eye on the situation. Having said so, fundamentally, there is firm demand for AN, especially for use in ABS resins, and we do not expect a major deterioration in the supply-demand balance. We are aiming to restart idle capacity in South Korea at around the end of 2022 and are working out details now. In terms of pricing, we will consider formula-based pricing that factors in costs. Thank you. My next question is about the healthcare business category. It appears that sales growth of ENVARSUS XR in Q2 was rather sluggish compared with Q1 or with the same period last year. Is it due to the impact of COVID-19 still continuing from Q1? How confident are you that growth would recover in the second half? Can you explain why the operating income forecast was downward revised from the initial forecast? The growth rate of ENVARSUS XR has indeed slowed down temporarily due to the impact of COVID-19. Activity was restricted for medical reps. The number of new kidney transplants came down. There are reports that a certain number of kidney transplant recipients died due to COVID-19 infection, and this may be a factor too. However, these are all temporary effects due to the pandemic. Meanwhile, the share of ENVARSUS XR in the tacrolimus market is steadily increasing. It is prescribed to more than 35% of new kidney transplant recipients. The growth is outpacing expectation. We therefore expect recovery going forward. The downward revision of the operating income forecast is mainly due to ENVARSUS XR sales falling short of plan. We do, however, believe that the drug will be back on the growth path once we recover from the COVID-19 impact. Thank you very much. This concludes today's earnings briefing. Thank you very much for joining us.