As it is now the scheduled time, we will begin. My name is Yamauchi, and I will be serving as today's moderator. We appreciate you taking the time out of your busy schedules to attend our investors meeting for FY 2025 financial results, management priorities, and business strategies. Today's session will begin with a presentation by our President Mito, followed by a Q&A session, and we are scheduled to conclude at 5:45 P.M. With that, Mr. Mito, the floor is yours. I'd like to start the investors meeting for FY 2025 financial results, management priorities, and business strategies. Thank you very much for attending despite your very busy schedule. Let me start. This is the agenda for today. Here is the summary for today. First, the FY 2025 results. We had very strong results. Even looking at underlying results, stripping out our gains and business dispositions, we had good results. For guidance for FY 2026 underlying business performance call for solid growth in earnings power. The driver for that is number 1, Agro & Life Solutions, and another is ICT & Mobility Solutions. For AGL, this time in the U.S., two companies were integrated to build a new company, and centralized that company biorational business will be further expanded. For ICTM, in terms of figures, it is a little slow, but with strategic upfront investments in entering new market, new materials markets, we will strengthen the foundation to support future earnings growth. In particular, the rapid shift to AI in the society, to respond to that, we will steadily expand our business. We are starting to establish organization capable of doing that. As for the reconstruction of a P&P business, we will clear the challenges and lead to strengthening of essential business. In particular, for essentials business, the conventional type of business will be strengthened. At the same time, the business model of a license and catalyst business, that is our IP assets, will be used. We will shift to that model. For investment discipline, we have been repeatedly being mentioned that this is important issue. We implement measures through rigorous investment discipline and also focus allocation into strategic capital and also strengthen our organization. By implementing those measures, we will improve the capital efficiency, and we'll coordinate efforts across business and corporate divisions to enhance enterprise value. This is the summary of what I'm going to discuss today. Next page. First, the financial results. Sales revenue was JPY 2, 328 billion, reduction of about JPY 278 billion. For P&P ICT business, because of the divestiture of these businesses, core operating income was JPY 208.4 billion, an increase of JPY 68 billion. Net income up JPY 22.4 billion to JPY 60.9 billion. ROE, ROIC, both 6.4% and 5.6% respectively. In February this year, we revised upwards our forecast, and it is further higher compared to the results of 2024. We are seeing a great improvement. This breakdown by sector, core operating income by sector. Agro & Life Solutions is at a similar level as the previous year. There's a slight increase compared to the previous year. It is even higher compared to forecast of February. For ICTM, there is a large reduction compared to previous year. The factors, there are two factors. One, is in 2025, early 2025, because of a Trump tariff, there was quite a lot of sales carried in advance in 2024, about JPY 10 billion in terms of core operating income. Another point is the recent AI semiconductor boom. General purpose semiconductors are in shortage, shipments into the low-end, the middle-end smartphones declined, and together with that, there was a decline of shipments of our display materials. For these factors, this led to a decline compared to previous year. Essential & Green Materials, major factor is the sale of Petro Rabigh shares, leading to a large increase in income. One highlight this year is Sumitomo Pharma's performance. Disposition of Asian business, JPY 49 billion included, and there was expanded sales of the three key products leading to a large increase in income. In total, core operating income JPY 208.4 billion, up JPY 67.9 billion. Forecast. Before talking about the forecast for 2026, let me talk about the current Middle East situation. For raw materials procurement, the whole company is working hard towards stable supply. In general, we are able to have visibility of requirements up to June, for others, we have a variety of products, so there are risks here and there, but we're able to secure requirements for the current production plan. For utilization trends, Japan P&P. Environment of raw materials procurement and inventory situation, considering that operations are continued. For Singapore, unfortunately, in March this year, force majeure declaration was made. There is a potential supply constraint, we are closely monitoring the impact. For others, of course, there are risks, but at the moment there are no major impediments of operations. From overall perspective, for raw material procurement, it is settling down, and in terms of procurement, risk is gradually declining, but rather price is getting higher. How are we going to respond and absorb that price hike through our own efforts of rationalization and efficiencies? If it's not possible to absorb through those efforts, we would like to consult with our clients about reflecting the cost hike. It's now at a phase of higher prices for raw materials, but for demand, we have not seen at the moment any major decline in demand because of rising prices. This is the forecast for 2026. Sales revenue increase of JPY 31.5 billion to JPY 2,360 billion. Core operating income, up JPY 6.6 billion is expected. On the underlying performance basis, it's a large increase. I will explain about it in the following slides. Net income, up JPY 9.1 billion. With that, ROE, 6.8%, improvement of 0.4 percentage points. ROIC, down 0.1 percentage points. Sumitomo Pharma increasing capital, so denominator slightly increased. Compared to 2025, ROIC is slightly lower. This is the forecast for 2026 by sector. Agro & Life Solutions, JPY 8.7 billion increase is forecasted. On the other hand, for ICTM, as I mentioned earlier, semiconductor shortage is a factor leading to reduction of shipments of display materials and fixed costs. In particular in semiconductor sectors, there's impact of investments made in advance, but we expect increase in shipments of semiconductor materials. Essential & Green Materials, JPY 5.6 billion increase is expected. At the moment, the refinery margin of Petro Rabigh has greatly improved, which is included in these results. For Sumitomo Pharma, compared to the previous year, it is a reduction of JPY 14.4 billion. As you know, in 2025, there is JPY 49 billion from the disposition of Asia business. Excluding that, this is a large increase. In total, JPY 215 billion cooperating income is forecasted. Next page. This is showing our 2024, 2025, 2026 core income on underlying performance basis and how they've transitioned. If you look at the 2025 actual, the underlying performance, compared to the previous year, we had an increase by JPY 50 billion. Also for 2026, we are not expecting capital gains on business dispositions, so the forecast is an increase by JPY 80 billion in income. On the underlying performance basis, this is going to be a significant increase in income that we hope to achieve. Next, please. In line with this, our financial standing has significantly improved. If you look at the D/E ratio, in 2023 it was 1.3, but at the end of 2025, it became in the range of 0.9. Furthermore, the capital increase of Sumitomo Pharma also contributed to the D/E ratio decreasing to 0.8. Financial standing has seen a much improvement. Next, please. This here, based on the results I've covered so far, this is for FY 2026 dividend forecast. We forecast an increase in the annual dividend to JPY 16 per share. However, having said that, we do not believe this to be at the appropriate level. In the future, we hope to achieve an annual dividend of JPY 24 per share at an early stage in the future. Next, please. From here, I will go into sector strategies. Next, please. Before I go into this topic, I would like to cover the status of our business portfolio. Back in fiscal 2017, we had a core operating income of JPY 262.7 billion. The growth drivers that we've identified, we had health, agriculture, and information, electronics. They did not account for 30% of the total of the income. They were less than 30%. Most of the income came from the P&P business. However, if we look at the portfolio today, almost 60% of the core operating income came from Agro & Life and ICTM for FY 2026, or that is the forecast. Income coming from a P&P has been reduced significantly. For others, pharmaceuticals or related businesses, if you look at the breakdown, if you look at the profit structure, we have advanced semiconductors and life sciences accounting for much of the earnings of Sumitomo Chemical as of today. Going forward, we will concentrate our investments into the growth drivers so that we can further advance our business portfolio. Next, please. First, I will cover the Agro & Life Solutions sector and its strategies. I've had several occasions to talk about the strategies, but for the crop protection chemicals, we are confident in our ability for a drug discovery. From 2024 to 2027- 2020 to 2024, there were 35 new active ingredients launched to the market. Five of them came from our company, and 3 of the 5 are expected to become blockbusters. For Rapidicil and Pavecto, we will fully start to register these going forward. At present, we will focus on how to expand the INDIFLIN sales. Next, please. When it comes to INDIFLIN, as was announced before, in the Central and the South Americas, this is used for the rust disease for soybeans, used as a fungicide. When we first developed this product, it was a single market, still had a scale of JPY 300 billion. It was a very attractive and large market. Since then, the market has further expanded and in 2029, it is expected to become JPY 4 billion or JPY 600 billion in size. Therefore, this is a highly attractive market for us. The market that we are addressing is expanding, but at the same time, competition is becoming more intensified. On the other hand, INDIFLIN has a high performance compared to competitive products. By further promoting the uniqueness and characteristics of this product, we can further grow our sales in this massive market. If we look at the surrounding areas, for example, in Paraguay, their soybean farming practices are similar to that of Brazil. They are also struggling with the rust disease. We have established a local entity called Sumika Paraguay so that we will also promote sales expansion in the neighboring countries. The major target indication is for soybean rust, but this INDIFLIN has effect on various other efficacies. As you see in this graph, in various countries and targeting various crops, we will continue to expand our indications so that sales will further grow in areas besides soybean. Next, please. Next on biorationals. Conventionally, we had VBS that focused on biorationals and MGK. They mostly focus on botanicals or plant-derived materials. These were the businesses that were our focus in the biorationals area. By consolidating the two companies, we hope to concentrate the knowledge and experience into this new organization and pursue synergies to further grow the business. Another aspect is that since there were two separate companies that have been operating, by consolidating, we can also rationalize the indirect expenses. We can realize a lean and efficient business operation structure that eliminates redundancies going forward. Our biorational sales are currently is somewhere between JPY 70 billion-JPY 80 billion, but by early 2030s, we hope to double this sales size. Next, please. In order to achieve that goal, these are the specific measures that we are considering. Especially in South America, biorationals are gaining traction and further growing. As seen here, it has increased by 2.5x over the past five years. We have identified South America as one of the focus area. As for North America, biostimulants are gaining much attention, so the FBSciences that we've acquired, their product lineup will be introduced in order to grow the North America business. As for Europe, if you look at the third row on the right-hand side from the top, this shows the number of new product registration in Europe since 2018 for both biorationals and chemical crop protection. As the graph shows, since 2020 up to 2025, there has been zero chemical crop protection registered. Finally, in 2026, there is one herbicide registered. What this shows is that gaining registrations in Europe has become very difficult. However, biorationals are growing its registrations year- after- year, so we do have capabilities, world top-class biorationals capabilities. This presents us with massive opportunities, and we will be focusing on Europe as well. As for the portfolio, we have pipeline development for biorationals close to 40 in the pipeline and for botanicals as well. In the beginning, it was only the pyrethrins, but in addition to this, we are working on the launch for two more products. Not just the chemical crop protection. In the animal nutrition area, we hope to launch two products in this area, and we are currently making preparations for that. In addition to agriculture, feed, stock additives, we hope to introduce our biorationals. Next, please. Next is ICTM. Here also, as you know, the semiconductor market is rapidly growing. In particular, AI semiconductors are showing a explosive expansion of a market. With that, our semiconductors business is also steadily expanding. Going forward, development of advanced products and top-level quality and mass production, through that, we will make proactive investments to expand the business. For that purpose, technology, production must be further sophisticated, and we have to accelerate the global deployment. As you can see here, in Japan, first photoresist mother site, which is Osaka, we will strengthen its function. Recently, next generation EUV technology center was newly decided to be built. We will establish organization for development, mass production and analysis in an integrated manner. For R&D, we will start operations of advanced ArF lithography tool. As I will describe later, with that, we will accelerate the development of new products. We will increase the manpower to respond. We will establish an advanced chemical center last year and we'll advance the cooperation development between Japan and South Korea, and also Japan, South Korea, China. In places neighboring the customers, we have established our footprint ahead of others. Recently, in the U.S. as well, semiconductor foundry are increasing. In Texas also, we have established our new location. In the United States, in Arizona, TSMC, Intel have foundries. As you know, Taiwan, including TSMC, is a place of accumulation of larger foundries in the west coast of the U.S. and in Taiwan. To expand our locations there was a major issue. As we show later, with acquisition of AUECC, we were able to realize geographic expansion. Next page. As I have said, this slide shows the significance of acquisition of AUECC. With acquisition of AUECC, there are two significances. One is expansion of territory, and another is solution. Be able to provide a broader range of solutions. Expansion of territories, as you can see in the bottom right, as I have already mentioned, Taiwan, west coast of U.S., new manufacturing plants are established. The strength of Sumitomo Chemical Company is in advanced semiconductors technology. In this area, we have a top-class Analysis technology. We have established a global organization proactively. For global locations, I have already introduced, and for solution, our top-class technology can also be used for our AUECC's portfolio to further strengthen technology. In our case, IPA or hydrogen peroxide, ammonium hydroxide, we have volume zone products, but AUECC has specialty sector products like hydrofluoric acids. Both portfolios getting together, it will be possible to create synergy. With that, the current sales by 2030, we want to double the sales or even more than that. Next page. This is photoresist sector. At this management meeting, I have described this before and this is updated. In the immersion ArF, we have very strong position. One example was the negative type development without using solvents. Photoresist was developed, which can be used for alkaline development. As at the global top class immersion ArF resist technology can be further developed to strengthen the business. One means for doing that, as I introduced earlier, advanced ArF lithography tool is introduced and recently operations will start. In early 2000s, the customers used the advanced lithography tool that was used at the time. We introduced the same tool to accelerate the development, and with that, we're able to establish our strong immersion ArF resist position. Currently, some other manufacturers use FlexRay advanced device, but that is different from this device that is used. The illumination condition is different, but by introducing a tool using the same illumination conditions as our customers, we want to further strengthen the immersion ArF resist sector. For EUV, next generation High-NA EUV, we will expand our own organic molecule resist to aim for a share of 20%. For backend process, AI semiconductors with explosive penetration, high integration, higher performance, and bigger sizes are advancing, and the panels, from wafers to panels and larger panels are being introduced. In the backend process, frankly speaking, we are a latecomer. With the changes in manufacturing platform, we take this opportunity and we will expand products that can be introduced in the backend process as written in the blue letters, epoxy resin ink and the relative materials of temporary bonding and Glue Cleaner and high-purity alumina. In these areas, we have already started mass production. Our business will be expanded in the backend process area as well. Next, Advanced Medical Solutions sector. This is important milestone was achieved. Amchepry, a drug for Parkinson's disease, obtained conditional approval in Japan. First, after approval, clinical studies will be conducted steadily. Clinical study will be conducted with 35 patients. After transfusion is completed, we will further increase the number of patients in phases. In the 2030s, early stage of 2030s, if this drug is approved in the U.S., this will become a blockbuster product that can grow up to JPY 100 billion in scale. For other sectors, CDMO business is another area that we are looking forward to. The CDMO business that we conduct are not cases that need large investments like antibody drugs CDMOs. With a minimum investment, we want to achieve a maximum benefit. These are the measures that we are going to implement. For advanced small molecules in Japan, we already have a top position. In the future, we also want to have overseas customers, with the current facilities that we have, sales of only about JPY 40 billion can be achieved with the current production capacity. With efficient investment, we want to increase this size. We announced recently that Koei Chemical is now a 100% subsidiary and use their advanced manufacturing tech facility as a GMP will be used. Our technology is being highly appreciated by the customers, the Oita plant is in full operation. The CRO in the U.S., we are establishing places to ask for research and provide samples so that the recognition of our company will be further enhanced. This has started in April, already utilization is nearly full. For regenerative medicine, we are front runners. The companies are having difficulties in earning profit, we reached the five consecutive years of profitability. Already we have three CMCs completed, starting operations, already the three plants, we expect full utilization. By using subsidies, we will begin construction of a fourth plant. After the four plants are completed, in terms of sales, more than JPY 10 billion of production capacity will be available. By doing so, we want to further expand our business. For EGM, as I have said, upstream Keiyo Ethylene and downstream Prime Polymer integration and Petro Rabigh, there is improvement with refinery margin. Singapore, we will work on with a restructuring steadily. One topic, as I have mentioned at outset, in the P&P business, there's competition of capital expenditure. It is difficult to win against China. Going forward, we will strengthen the capacity of existing business, and also in the environmental related business that we have will be licensed to other companies. We will shift our model to earn profit by using our IP. Recently, this is a recent case. Our hydrochloric acid oxidation technology was recently provided as a global license to BASF, also PMMA chemical recycling and production olefin from ethanol, GX related technologies. This licensing will be accelerated and shift to a model where we can earn profit through this model. Next page. Next is strengthening management base. As I said in the beginning, investment discipline has been a challenge for us. As I covered this topic previously, we've thoroughly quantified various risk scenarios to consider them. Also, both from within and outside the company, we sought objective opinions. We also implemented a decision-making that was agile in order to determine our policies forward. Under the new management processes, one of the first largest investment case was the acquisition of the AUECC, which I've talked about before. Here we've sought opinions of experts from inside and outside the company and ran a multifaceted simulation analysis so that we could have a quick and rational decision-making. This led to this acquisition. The three years under the midterm management plan period, as for the progress in capital expenditures, loans, and investments, we will have JPY 230 billion invested into growth strategic areas, and 80% of that will focus on AGL and ICTM. These are the two growth drivers. Already JPY 70 billion and more of strategic investments have been made. Into Agro & Life Solutions, AGL and ICTM are covering 75% of that JPY 70 billion investments already made. As according to the plan, we are proceeding with more focused investments into the two growth areas. Next is the reorganization of R&D functions. So far, when it came to corporate research, we emphasized the importance of autonomy. In some cases, corporate research would work on research projects that were not necessarily aligned with the business unit research. We've developed a roadmap for both corporate research and business unit research in an integrated manner, and by having an organization that serves as a cross-functional center, we can focus our R&D resources into areas where we can win. That is the new structure that we have in place. Next is on DX. Since before, we've worked on DX 1.0, 2.0, and 3.0, so we've promoted this. Over the past two to three years, we've seen a rapid evolution of AI. We had to pause and revisit our DX strategy. For us as well internally, we have to shift our efforts into utilizing AI. I think that's at the stage where we are currently. You see accelerate democratization of AI shown here. The employees as well as the management, we are working to accelerate the utilization of AI. What we are currently promoting specifically is to have all the information, various types of information, found internally in the company, and fed that into plug-ins so that information pieces that will help a decision-making will be extracted. We are also considering the introduction of AI agents that will facilitate such information extraction. Next, in terms of DX 3.0, particularly of the services listed here, Tsunagu, this is a service provided to the agricultural sector. In the interest of time, I will not be able to cover the details, but for domestic agricultural sector, we have the potential of becoming a significant platform. We are working on development of various applications and commercializations. We are proceeding with the work to establish such platform. Next, please. As for the executive compensation, we are increasing alignment with the business performance and capital efficiency. The variable remuneration portion will be raised from the 50% before to 60% and also introduce a coefficient for ROIC achievement. Consolidated business performance KPI multiplied by coefficient was used to calculate remuneration. We are introducing this new coefficient and multiplying that to the previous formula to calculate the compensation. That is the new change that we are introducing to the executive compensation system. Next is the parent subsidiary listing for FY 2024, Shinto Paint, Sumitomo Bakelite, and Inabata. We sold all or some shares of these companies. For FY 2025, and just the other day, actually yesterday, Tanaka Chemical and Koei Chemical were made into a wholly owned subsidiary, or the plan was announced to make them into a wholly owned subsidiary. Tanaka Chemical has already completed that process. For the remaining companies, we will continue to study them. The basic way of thinking is that under the group strategy through business growth and synergies, if they contribute to maximizing enterprise value, then parent subsidiary listing remains an option to be considered. Next. At the end, this is the same slide I always share. Once again, to share my resolve, I would like to cover this. In our company, capital efficiency still needs to be improved much. We are still in the process, so we will work on management conscious of capital efficiency and enhance enterprise value over the medium to long term. Next, please. Lastly, this is a summary. In FY 2025, our business performance recovered strongly, and also we made further progress in strengthening our financial standing. Of course, we are still in the process. We have finally have the groundwork laid out for future growth. If we look at the portfolio, in our case, we are already very much focused on life sciences and advanced electronic materials as core businesses. On the other hand, we have growth drivers, Agro & Life Solutions and ICT & Mobility Solutions. They are accounting for the majority of earnings. We are also accelerating the shift towards a portfolio led by world-class businesses such as biorationals and advanced electronic materials. Particularly the ICTM solutions results were somewhat muted, as I said before. Particularly for the semiconductor materials business, we have strengthened our structure to meet the growing AI semiconductor demand, particularly for the backend process materials. For the AMS, we've made a steady progress in building a foundation for long-term growth. For the EGM as well, we've advanced the structural reforms, and we are shifting towards an IP and licensing-driven business model. That concludes my presentation. Thank you. Thank you very much, Mr. Mito. Now I would like to receive your questions. The first question is from Morgan Stanley MUFG Securities, Mr. Watabe. Thank you. I'm Watabe from Morgan Stanley. Thank you for your presentation, and thank you for the good results. I would like to combine a few questions into one. First, it's one year since you became the President. How did Sumitomo Chemical change? Performance, financial results are getting very good, so I'd like to hear about that. As for financial results and forecast for this year, how did you include the impact of the Middle East? You have mentioned that it is partially included, for instance, AGL example. What's the situation of adjustment of inventory in Brazil, or what is the impact of the recent higher prices in agricultural sector? The background of crop protection chemicals increasing profitability and net profit compared to the operating profit, bottom line seems to be low. Could you explain me that background as well? Thank you. Thank you for your question. First, one year since I became the President, how did the things change? Well, after I assumed the position of the President, I have always been talking about the bottom-up, a place where everyone can speak out and exchange views. I wanted to change the workplace, a place where people are active. This time, we're able to make good recoveries in performance. It's not that there was one big factor for that. Each one in each business unit in each location, many measures, many ideas were executed, and I think this result accumulation of those efforts. What I aim for, a bottom-up and autonomous organization aiming for the target, e- to everyone working together for that purpose, I think we're able to make one step forward to this type of organization. That is how I evaluate myself. The situation in Middle East. In each business sector's performance, risks are included. For example, related to the second question of Watabe, in case of AGL, with shortage of fertilizers, there may be a delayed planting by the producers, leading to reduction. For ICTM, material costs are increasing. That is a risk that it may not be possible to shift everything into the price. For EGM as well, it's a similar situation. For each risk in each business sector, the risks are included. At the moment, it's very difficult to say, but the current situation, if this continues until summer or autumn, in total core operating income business, there could be a negative risk of about JPY 10 billion, and that is taken into consideration. For AGL risk, as I have mentioned, it is true that shortage of fertilizers is something that we are monitoring carefully. It's very difficult to say. It is true that this may cause a delay in the plantings, and that may lead to reduction of sales of crop protection chemicals. In case of Brazil, that is a large crop production area in the world. Will there be such a large delay in plantings? I'm not sure. I want to keep watching with care. For net income, compared to operating income, net profit decline is larger compared to operating profit. Well, this year, we are conservative. Like I say, impairment, we are looking at impairment conservatively, and also at EGM, Essential & Green Materials, structural reform is still on the way. It's the middle of a way of structural reform, so it's not that we are aggressive, but in advance, we are trying to reflect that. As a result, net profit is JPY 60 billion. It's JPY 70 billion, right? For 2036, yes, it's JPY 70 billion. Thank you very much. Thank you for the question. We would like to take the next question from Mizuho Securities. Yamada San, please. Yes, this is Yamada of Mizuho Securities. Can you hear me? Yes, we can. Thank you. Thank you for the presentation. Looking at the business portfolio transformation and financial standing strengthening have made much progress compared to two years ago. What you've said back then, I think I can certainly see solid progress. In September last year, the president said that the company would be focused on areas where they can win, and we are seeing the results in that regard. As for the business portfolio and strategies, I would like to ask further. Towards the end of the presentation, you talked about strengthening management foundation and R&D functions. I think they all make sense. They are reasonable. In the last summary, you said that Agro & Life Solutions and ICTM, that's where you see areas where you can win. For Advanced Medical Solutions, you've now made Koei Chemical as a subsidiary, and you will be promoting the CDMO. They all make sense, but is there any missing piece? Is there any area that you still need to further work on? The ICT enhancement has been made, but any other areas that's lacking today? When you say areas where you can win, for you to win, in order to input necessary resources, the other businesses that are not areas where you can win should be terminated, in my personal view. iPS, you said that's one business that you want to do back in September last year. I don't think there's anything we can do about that. Going into clinical trials, you need massive resources. How are you going to supply those resources or address the resource needs? Petro Rabigh, improvements are made, but for the Essential & Green Materials business, against the ideal end state, how much progress have you made? Thank you. Those are my questions. Thank you. First of all, Mr. Yamada gave us a nice summary, AGL, ICTM, and ATM. I believe you're talking about the chemicals and small molecule in strengthening CDMO, and I believe your question was asking whether there is any missing piece. That was the first question, as I understood. Regarding this topic, this is something I've been saying since before. For chemical synthesis, organic synthesis technologies are most leveraged in this area. Since this is the first year, we are still working on it. It's still midway. Since I became president, I've emphasized the importance of leveraging our strengths and focusing on this area, and we are starting to see results of our efforts. We are moving in the right direction. Rather than seeking and acquiring areas that are missing today, we will further leverage our capabilities, the organic synthesis technologies, to further achieve successes in this area. Repeatedly, Yamada San has talked about this iPS. Is this really the business that Sumitomo Chemical should be working on? I believe you've been asking us about that on multiple occasions. The one thing I can say is that, well, last time, I talked about how I'm adamant about this, but not just that. Looking at other pharmaceutical CDMO business, I believe that there could be synergies generated with the CDMO business. For example, today, conventionally, a small molecule, medium molecule, diffusion, cell therapy, so these are areas that we've worked on, and these are separate areas. As modalities, they are increasingly becoming more integrated. For example, nucleic acids. We would have automatic synthesis machines and use the nucleic acids made from that to be used. Now this, a different method is being used, and for delivery, new conversion tools are being used. For small molecule, organic synthesis, technology is very much in need, in demand, for these new approaches. A nucleic acid CDMO and small molecule CDMO are starting to see synergies being generated. For cell therapy as well, using gene editing, basically, genetic editing is taking place, and this will be used in therapy. The customers that we are targeting. Also working on genome editing as well as cell therapy. We are seeing an increase in the number of customers who do both. When chemical synthesis technologies are in need, of course, we have very strong capabilities at the GMP level, a small molecule, through organic synthesis. Leveraging our GMP expertise, small molecule nucleic acids, and also iPS cells that could have synergies with the small molecules. We can address both areas. These are the capabilities that we have. As a whole, as a CDMO business, I think we will be able to position ourselves in a very unique state. The three areas of CDMO are certainly areas that we hope to continue to address. For drug discovery, this doesn't necessarily mean using organic synthesis directly. Last time when we had a conversation with you, Yamada, we come back to the same topic that was covered. The origin comes from chemicals, safety evaluation by Sumitomo Chemical, and we decided to use iPS cells for evaluating the safety of our chemicals, and that's how this business has started and developed to this day. It's not necessarily organic. It's not that we do not have any technical background. It's just that for the longest time, we've accumulated experience and technical capabilities in this area in the world, and the government has provided support, and that put us in the front-runner position. As Sumitomo Chemical Group, this is a business area that we certainly would like to continue. For pharmaceuticals, R&D costs could be quite enormous, and you may wonder whether Sumitomo Chemical has the ability to support such funding needs. In case of regenerative and the cell therapy area, the diseases that are targeted are not like a small molecule business where there's a number of patients. We are always considering the necessary R&D costs that may be needed in the future. We are updating ourselves regularly and assess whether there is sufficient funds to cover the necessary costs that we are in discussion with Sumitomo Pharma. As Sumitomo Group, we are frequently updating. Compared to small molecule R&D that requires hundreds of billions of yen of investments, it's smaller by an order of magnitude or even much smaller. This includes the clinical trials in the North America. We believe it's certainly within our capacity to do. Based on these assumptions, we have identified and determined that this would not negatively impact our financial standing, that we have enough R&D resources to pursue this. Thank you. Agro science and ICT investments, as long as there's no risk of under-investing, I'm fine with that. Thank you very much. The next question is from SMBC Nikko Securities, Miyamoto-san. Thank you for your presentation. I'm Miyamoto from SMBC Nikko Securities. Congratulations for the financial results. I want to hear about the prospect of crop protection chemicals, which is the center for growth, in particular about biorationals. You have explained that on page 17. Previously, M&A in Europe of crop protection chemicals was considered an aim at growth through biorationals. What is the current situation of such products in Europe? You expect acceleration growth in 2027. The integrated company in the United States will be operating in full-fledged manner from that year, or the botanical portfolio will be influencing it. What is the reason that biorationals will accelerate in 2027? In Europe so far, for chemical crop protection, registration is becoming tough, and for Pavecto, registration in Europe, is there a risk of being difficult to register? Thank you very much. First question, biorationals in Europe, in particular, include M&A. What is your strategy? Well, as was indicated this time, in registration for new chemical crop protections, and also for biorationals, needs for biorationals are increasing. Brazil, North America, India, and next to this, Europe is also a strategic area for biorationals First, development of products in Europe. We're engaged in development of products in Europe, as we have explained before. The sales organization, there's a footprint in Europe, in particular in France, Spain, Italy. In the major agricultural countries and also in the U.K., there is footprint. In terms of production and R&D and logistics, we don't have such functions. For further growth going forward, we have to invest in these functions. Maybe I talked about it before, a corporate-wide resource allocation, AGL and ICTM are the targets. AGL remains in Europe, but from a bigger picture, ICTM semiconductors, in particular AI semiconductors and backend process sector, are areas that we want to concentrate our investment. We are seeing improvements of our financial position. With the surplus powers that we can generate from that, if we can invest into AGL, then in Europe, not only sales organization and portfolio, but production, R&D, and logistics in these areas as well. We want to make investments going forward. We are thinking about doing that. From 2027, biorationals growth will accelerate. There are many factors. One major factor are biostimulants. We are looking forward to this. Biostimulants, compared to what we have assumed, development and sales expansion is taking more time. The product development and registration system is different from country to country. After registration is made to be able to sell the products, there must be higher awareness among the customers. We may test for many years, but different from crop protection chemicals, it is not something that we can clearly see the outcome. The producers must be able to confirm by themselves improved yield and production. We have continued with the steady efforts during the last few years. In 2027, by around 2027, in particular in North America, we believe this is going to start. It is taking time. Central to biostimulants, we want to accelerate further growth. Chemicals crop protection in Europe is so difficult, so is it all right with Pavecto? Well, frankly speaking, Pavecto in Europe to get a registration, I'm not saying it is impossible, but rather, compared to other products that were aiming at registration, safety profile is very good. We will continue to aim for registration. This is not scientific anymore, whether it is registered or not. I'm sure we will get a registration, but it's difficult to say when we can get the registration. On the other hand, Europe, wheat sector is a major target, but there is a target spot disease in South America. This was not a serious disease in the past, but recently, target spot has increased, and the Pavecto shows a very good effect on this target spot. The target is shifting from Europe to South America and Brazil. We may be able to get registration earlier, and the major market for Pavecto could be South America and develop into a blockbuster in South America. Thank you very much. In addition, about the financial results, exports from China to South America and Brazil is slowing down. Is that a headwind for you? Well, I'm always asking that question. In addition to slowing down, generics shares are getting higher, that may become a headwind for us. Generic prices are getting higher. That may be a tailwind for us. Maybe, locally, they are more careful. We are not seeing yet a big impact. That is a positive situation for us. Thank you very much. Thank you, Mr. Miyamoto. We will now move to the next question from Nomura Securities, Okazaki-san, please. Thank you. This is Okazaki of Nomura Securities. Thank you for today. For Essential & Green Materials, I have some questions. On page 25, PCS production optimization was mentioned here. To the extent possible, could you share the current progress, particularly given the Middle East situations? Maybe there have been some delays or even qualitative information. If you could share the progress, I would appreciate that. To President Mito, I do apologize for asking you this question. Currently, given that the market is performing well, Rabigh has generated much income this term, Singapore and domestic businesses are experiencing adjustments, correction in terms of utilization operations. If you look at the overall balance, the JPY 20 billion operating income for this fiscal year, what is the probability of achieving this? Yes, thank you. Regarding the PCS in Singapore, and the plans ahead, it's exactly as it is described here. Before I explain the details, I will say that Singapore PCS, since when it comes to this area, I don't have much experience, and I'm no expert. Based on what others have said, for many years, over the past years, they've provided products in a stable manner. They've gained much confidence among customers. PCS is highly regarded in Asia. On the other hand, there have been oversupplies from China, this has put a downward pressure on their earnings, they are struggling because of that. They are competitive. They have competitiveness, or rather, I should say, they are very much a trusted cracker. Within the Singapore Petrochemical Complex, they serve as part of the infrastructure. How are they going to fare in the future? How should we retain this going into the future? I think that's the perspective that we should apply here. There could be various forms. Already, this started as a joint venture in the beginning. There are partners, if we broaden our perspective, the derivative manufacturers could also be considered partners. In Singapore, they are an important and leading cracker in the upstream in Singapore. As part of the infrastructure, what is possible for us to retain that as part of the infrastructure? That is the kind of discussion that we are currently having. Given the recent Middle East situations, the status of utilization is something that I cannot share based on agreements with the joint venture partners and other stakeholders. I cannot go into detail, but that is the view I have to this business. Next, PRC or Petro Rabigh, at present, particularly its refinery margin, has significantly improved from January to March, their January to March period. For us, it's FY 2026 Q1. Their results will be reflected in our Q1 FY 2026. They performed very strongly. Operating income of $400 million also were generated, and also JPY 9.2 billion would be reflected in our Q1 results as a result of that. What will happen next is very difficult to predict and foresee. The Arabian Light premium has gone up, going forward, margin will be reduced significantly. PRCs, particularly polymer business, the market price will follow. There will be some time lag, we are not expecting any expansion of profits there either. Between January to March, the JPY 9.2 billion realized in that period reflected in our Q1. That's where we are, and anything beyond that, either upside or downside, has not been considered or incorporated. Given the situation, Chiba, Singapore locations, how should we balance these businesses? In case of Petro Rabigh, as you know, our stake has been declined to 15%, so our P&P business, a core of that, is in Singapore and in Chiba. These are the core locations for P&P business. We will continue to exert efforts in these businesses to improve business performance. In fact, for PCS, after the Middle East situation settles, as you see here on the slide, we hope to review the sales mix and increase our customers that will be willing to purchase at higher price ends, higher price points. For TPC, we are already starting this, and by switching to high value-added grades and to shift sales geographies, we hope to further grow our profits for FY 2026. That's the direction that we are heading. For MMA, due to the suspension of the lines, we have now established ourselves to start earnings, and we believe we can further expand this fiscal year. In the interest of time, I will not be able to cover the details, but for Chiba location, we will focus our efforts. Singapore and Chiba will be the core for this business, and we hope to achieve the JPY 20 billion of core operating income. Over JPY 9 billion for the Q1 coming from Petro Rabigh, given the current low utilization in Singapore and domestic location, even given these factors, you can expect a certain level of profits. Right. The disruption coming from the Middle East, to what extent will this be sustained? We do expect this to settle and subside at some point in time, but what will be the impact then? Raw materials procurement, if we make a misstep in a decision, then we could generate huge losses from inventory valuation. Given the raw material prices are skyrocketing, of course, given the normal circumstances, this would have a negative pressure on our margin. There are various factors to be considered. At this point in time, we are considering both the positives and negatives, and we hope to achieve the JPY 20 billion. Thank you. Thank you very much, Mr. Okazaki. It's now time to conclude. The next question will be the last question. From UBS Securities, Omura. Thank you. I'm Omura from UBS Securities. Thank you for your presentation. In general, it was very clear presentation. Thank you very much for that. I also, just like Mr. Okazaki, with regards to the results for this year, I had more questions. In your presentation, the JPY 215 billion plan, is that based on a conservative assumption or not? That was not very clear. For Essential & Green Materials and Agro & Life Solutions, for these two sectors, for example, JPY 9.1 billion in Q1 for Petro Rabigh, that is already included, so remaining JPY 11 billion. What are you looking at, in what way, leading to these figures? For Agro & Life Solutions, what are the assumptions in making these figures for this forecast? Could you break down the background for those figures? The performance for this year for Agro & Life Solutions, nearly JPY 10 billion increase. Is this achievable or not will be a very important key point. As you can see here, the key for that is overseas, in particular Brazil. Can we grow in Brazil or not? That will be the key. In doing so, as was included in the questions today, shortage of fertilizers related to the situation Middle East or demand for crop protection chemicals might decline in Brazil. Of course, there could be such risks. On other hand, in case of Brazil, for the last three or four years, because the problem of the distribution inventory market was stagnant, it is finally reaching a recovery phase. As was mentioned before, China's crop protection products, shipments into Brazil and price, we have not had any clear comments from our team in Brazil, but I personally think that may happen. If we think in that manner, these figures, I don't think these are optimistic figures, but are highly achievable figures, and EGM is very difficult. Maybe I said something opposite previously. When the price gets higher or lower. The past theory may not be applicable anymore. A rapid price hike or shortage of products may happen. In terms of payment, that may not necessarily be negative. Will that advantage remain even if prices decline? Maybe not necessarily so. When will the situation stabilize? How will that happen? Will that be a moderate stabilization? Will there be a rapid fluctuation of the raw material price? Unless we can identify that, depending on the situation, the impact on profit and loss will greatly change. It is very difficult to break down into multiple factors and say clearly, but in overall, there are positives and negatives. Twenty billion, which is written here, is definitely something we want to achieve. Maybe my answer was not very clear. Well, thank you very much. It was not clear in your previous comment, but if possible, could you tell me, for Petro Rabigh, JPY 9.2 billion first quarter, and after Q2, you are not seeing either upside nor downside. Do you mean JPY 9.2 billion will continue or do you mean zero? What do you mean by that? Up to JPY 9.2 billion from the It is upside compared to the conventional budget. After that, there may be ups and downs. It may be going up first and then go down compared to the budget. Compared with the budget, after Q2, we are not seeing any upside nor downside. That's what I meant. I see. It was very clear. Thank you very much. Omura-san, thank you very much for your questions. It is now time to conclude. FY 2025 financial results, management priorities, and business strategies investors meeting is now concluded. Thank you very much for joining us today. Today's briefing will be uploaded onto our company's website from tomorrow, including the Q&A portion. That is all. Thank you very much once again for your participation today.