Thank you very much for joining us today. This is the earnings conference call of Mitsubishi Chemical Group. [Foreign Language] It is time to start. [Foreign Language] After the presentations, we will take Q&A. We plan to have this meeting for about 60 minutes. Before we start, we'd like to say the following: the presentation will include the forecast for the future. There will be some risks and uncertainties involved, and actual results could be very different from what we present today. Please keep that in your mind. The audio of today's conference, including the Q&A, will be available from our website. [Foreign Language] Now, we'd like to start the conference. We'd like to invite our CEO, Mr. Chikumoto. [Foreign Language] Good afternoon, ladies and gentlemen. This is Chikumoto CEO. Thank you very much for taking time out of your very busy schedule to join our financial earnings conference call. We'd also like to thank you again for your continued support and understanding for our business. Firstly, I would like to make some brief comments at the outset, and then our CFO, Kida, will give you a detailed account of the first half results. The results for the first half of FY 24 exceeded the group's initial forecast by around 40%, largely due to the impact of the rising MMA market and increased demand in the display market. We are relieved at the strong start to the year. In the six months since I took over as president, a new management team has been set up, and various discussions have been taking place. In the petrochemical business, three companies in Western Japan have joined forces to start a joint discussion to achieve carbon neutrality for ethylene production facilities. In the carbon business, which continues to suffer from difficult performance, we have decided to downsize the coke furnace at Kagawa Works and transfer affiliate companies. We will firmly implement structural reforms to achieve profitability in the coming year. In the specialty materials business, the decision was taken to transfer the triacetate business to the best owner. I n addition, other artificial sites are being rationalized. In addition, in order to achieve sustainable growth, we have decided to increase production capacity for photosensitive polymers, for photosensitive semiconductors, ion exchange resins, for production of ultra-pure water and semiconductors, and the optical films for displays. We will accelerate the selection and concentration of our businesses based on growth potential, competitiveness, and profitability. We are currently preparing to summarize our new mid- to long-term management policy in preparation for the management policy briefing to be held on the 13th of January so that we can explain this to our investors. We will do our utmost to improve our corporate value, and we'd like to ask for your continued support for our company. [Foreign Language] Thank you very much, Mr. 筑本. [Foreign Language] Moving on to Mr. Kida. [Foreign Language] Present the financial results of the second quarter of the year ending March 31st, 2025, and this is the summary. The business environment during the first half of '24 generally remained stable despite some different levels of strength in demand among regions and industries. Display-related sales remained brisk on the back of a high operating rate of panel manufacturers, and semiconductor-related sales remained on a moderate recovery path driven by demand related to generative AI. On the other hand, sales were sluggish in some regions and sectors such as automotive and food-related markets. Compared to the same period of the previous year, price improved as a result of the efforts to promote price management in each business and significant increase in the market prices for MMA monomer, leading to an improvement in sales volume for specialty materials and pharma. In addition, cost reduction efforts continued to contribute to income. As a result, looking at the group as a whole, sales revenue increased 4% year-on-year, and core operating income rose 44% year-on-year. Net income attributable to owners of the parent decreased 39% year-on-year due mainly to the recording of structural reform expenses and the special items. Core operating income for the first half of FY 24 was 57% higher than the initial forecast. On the other hand, in the second half of FY 24, business performances are expected to fall behind the initial forecast, mainly in specialty materials and basic materials and polymers, due mainly to a reactionary decline in demand related to displays, which had been brisk during the first half of fiscal 24. A delay in the recovery of demand related to semiconductor for consumer, industrial, and automotive applications, intensified competition for carbon fibers, and a delay in the recovery of market prices for petrochemicals and carbon products. We predict that core operating income for the fiscal 24 will increase 16% compared to the initial forecast of ¥290 billion in light of brisk results in the first half of FY 24. We reiterate our initial forecast of ¥52 billion of net income attributable to owners of the parent as several business structural reform projects are considered in the second half of FY 24, and losses under special items are expected to be recorded. Dividend forecast remains unchanged from our initial forecast of a year-end dividend of ¥16 per share and annual dividend of ¥32 per share. This is the overview of a P&L for the first half of FY 24. Average exchange rate in the first half was ¥152.5, 7% lower year-on-year. The unit price of naphtha was ¥77,700, up 19% year-on-year. Sales revenue was ¥2.421 trillion, an increase of ¥92.2 billion, or 4% year-on-year, including an increase of ¥79 billion due to FX, an increase of ¥46 billion due to higher selling prices, and an increase of ¥11 billion due to volume factors, and a decrease of ¥44 billion due to business reorganization. Core operating income was ¥172.4 billion, an increase of 44% year-on-year. The detail will be explained later on. Special items amounted to minus ¥35.7 billion, down by ¥54.7 billion year-on-year. Operating income was ¥136.7 billion, and income before tax was ¥106.1 billion. Net income attributable to owners of the parent was ¥40.9 billion. This was a decrease of ¥26.3 billion year-on-year, but a significant increase compared to the forecast of ¥10 billion for the first half of the year announced in May. Let me show the sales revenue and core operating income by business segments. Specialty materials recorded a 4% increase in sales and a 30% increase in profit year-on-year. As I mentioned in the beginning, demand from display-related markets was particularly strong, with advanced films and polymers and advanced solutions performing better than expected at the beginning of the period. Industrial gases continued to perform well, with a 5% increase in sales and a 14% increase in profit compared to the same period last year. In pharma, sales of Radicava in North America remained strong. Sales increased by 6% year-on-year and profits by 28%, which was a higher performance than expected at the beginning of the year. MMA and derivatives achieved a 25% increase in sales and a ¥23.7 billion increase in profit year-on-year, significantly higher than expected at the beginning of the year due to higher market prices of MMA monomers. Basic materials and polymers recorded a 1% year-on-year decline in sales and a reduction in the deficit of ¥4.2 billion. Among the factors contributing to the year-on-year improvement was a ¥1.5 billion impact from inventory valuation gains and losses. Materials and polymers business recorded an increase in profit year-on-year and secured a double-digit surplus despite scheduled maintenance and repairs at Ibaraki Ethylene Center, while the carbon products business continued to see no improvement in the coke market and recorded a loss of ¥16.3 billion. The following table shows a breakdown of the ¥52.8 billion increase in core operating income year-on-year. Price was positive by ¥28.4 billion. Of this amount, ¥9.9 billion was due to FX, mainly in the industrial gases and pharma. Excluding FX, the market price increase of MMA monomers in MMA and derivatives made a significant contribution. In specialty materials, the price improved as a result of efforts to maintain and improve selling prices across the board. Volume was positive by ¥17.4 billion. The positive contribution from pharma was positive. In specialty materials, the volume was negative year-on-year in the first quarter, but by the end of the second quarter, it was positive in all subsegments. Cost reductions were positive by ¥26 billion. Progress is being made as planned towards the annual reduction target of ¥47 billion for the current financial year. Other differences were negative by ¥19 billion. Inventory valuation gains improved by ¥3.9 billion, but this was offset by increases in labor costs in each business, fixed costs due to inflationary effects, and other factors. Now, let's take a closer look at the different segments. Specialty materials recorded a year-on-year increase of ¥5.7 billion, and the price was positive by ¥3.6 billion. Barrier packaging applications deteriorated year-on-year, but efforts were made to generally maintain and improve selling prices in other products, resulting in an improvement in this price. The volume was positive by ¥4.8 billion. In advanced films and polymers, demand for polyester film and POL plate film increased as panel manufacturers increased their operations due to large commercial campaigns in China and the expected increase in demand for TVs due to international sporting events. In advanced solutions, demand for semiconductor-related products recovered moderately at varying degrees depending on the product and segment. Volumes increased in materials for semiconductor manufacturing process, in the precision cleaning business, and water treatment equipment. In advanced composites and shapes, sales volumes increased due to recovery in demand for high-performance engineering plastics, particularly for semiconductor manufacturing equipment applications. In carbon fibers, on the other hand, sales volume increased for wind power generation and other applications, but sales volumes declined in the relatively high-margin pressure vessel application due to intensified competition from other companies, resulting in a negative volume. Cost reductions amounted to ¥4.8 billion, building on the effects of business restructuring, including the withdrawal from the acrylic fibers business and the self-help measures such as procurement optimization and productivity improvements. The other difference of minus ¥7.5 billion is due to labor and other fixed costs, as well as increased amortization of intangible assets following the consolidation of CPC as a subsidiary. Moving on to industrial gases, increase by ¥11.6 billion year-on-year in terms of profit. Although there was a softness in volume, mainly in the United States, foreign exchange effects, as well as price management, productivity improvement, and other initiatives developed in each region resulted in a price of plus ¥2.8 billion and cost reduction impact of plus ¥14.6 billion, resulting in a year-on-year increase in profit. Pharma increased by ¥9 billion year-on-year. Price was positive ¥3.5 billion due to the positive effect of FX, despite the negative impact of domestic NHI price revision, and the volume was positive by ¥8.9 billion. North America remained strong, supporting the profitability of the pharma business. Mounjaro influenza vaccine and Goshu pentavaccine in Japan also grew. The other difference of minus ¥4 billion is due to labor and other cost increases. Next is MMA and derivatives. The core operating income went up by ¥23.7 billion year-on-year. This is a significant increase. Price factor was positive ¥21.4 billion. MMA monomer market prices increased year-on-year. Spread widened. In addition, in coating and additives business, the price gap improved. Next is basic materials and polymers. The deficit decreased by ¥4.2 billion year-on-year. The price gap was minus ¥2.6 billion. Materials and polymers likely improved with lower coke market. The carbon products were negative and total number was negative. The volume factor in materials and polymer, there was a negative impact of the scheduled maintenance and repair in Ibaraki Ethylene Center, but the impact from the troubles of the previous year was reduced. Then volume factor was positive of ¥3.4 billion. Positive impact of cost reduction was ¥2 billion in petrochemical derivative business, business restructuring, and also the optimization of the equipment procurement and the improvement of the repair expenses. Others include the inventory valuation of ¥4.1 billion. The overall number was ¥1.4 billion increase. As for the carbon product, coke was declining and the inventory evaluation was negative. Materials and polymers, the naphtha price increased from the end of last fiscal year to quarter one, so it was positive overall. The special items at the first half total was ¥35.7 billion. In Q1, it was ¥2.4 billion. In Q2, we booked the special loss of ¥38.1 billion. Now, let me talk about the major items. The gain on sales of the shares of subsidiaries and associates was positive ¥11.1 billion. The Mitsubishi Chemical Indonesia, the share was transferred. This was operating TPA, and the forex translation realization profit was ¥5.6 billion, and the gain on transfer of Mitsubishi Tanabe Pharma in Tianjin was ¥5.5 billion. Impairment loss was negative ¥27.6 billion. In industrial gases, the hydrogen production facility construction by Matheson Tri-Gas was suspended, and with that, we booked ¥10.8 billion impairment loss. In carbon products, the decision to reduce the coke production in Kagawa was made, and the impairment loss of ¥7 billion was booked. Other than that, there are multiple temporary losses in relation to the closure of some unprofitable sites. Special retirement minus ¥17.9 billion includes Mitsubishi Tanabe Pharma's voluntary retirement program. Next is cash flow. Operating cash flow was ¥275.1 billion cash in. Operating receivables and payables was ¥33.3 billion positive. Inventory was outflow of ¥42.4 billion. The working capital total was the cash out of ¥9.1 billion. In some of the pharma, due to the brisk demand, the inventory was increased, and this was one of the reasons. We will continue to appropriately manage the working capital of each business. Investment cash flow was minus ¥145.3 billion. CapEx cash flow minus ¥172 billion. Industrial gases, specialty materials, there was a growth investment mainly in those segments, and also in basic materials and polymer. There was an investment for the maintenance and update of the facility in tandem with the scheduled maintenance in Ibaraki. Asset sales, cash flow was ¥24.3 billion positive, and we conducted a review of the business portfolio, and we booked a gain on sale of shares of subsidiary and PTA, and there was a cross-held share sales as well as unnecessary asset sales. As a result, free cash flow was positive ¥129.8 billion. Financing cash flow was minus ¥124 billion. Next is balance sheet. The total assets were ¥5 trillion ¥945.2 billion, down ¥159.3 billion from the end of last fiscal year. Major reasons include the foreign exchange in all the currency yen strengthened from the end of March, so that was the negative impact of ¥103 billion on assets. The end of the last fiscal year was a holiday, and that was about the ¥45 billion difference. Net interest bearing debt was down by ¥115.2 billion. Net D/E ratio was 1.11, which is a 0.05 point improvement from 1.16, which was the end of last fiscal year. This shows the core operating income trend from Q1 to Q2 of FY24. Q2 core operating income was ¥89.8 billion, which was up by ¥7.2 billion Q on Q. In specialty materials, in Q1 it was ¥11.5 billion, in Q2 it was ¥13 billion, so up by ¥1.5 billion. Barrier packaging, so on all, last year there was a demand was sluggish due to the inflation, but at the end of the last fiscal year it hit the bottom and is gradually recovering. From Q1 to Q2, both sales and profit increased. The water treatment equipment for electronic devices, in Q2 we booked relatively large orders, and this led to the higher profit. Advanced composites and the shape segment continues to be in red. High performance engineering plastics for the application of the semiconductor manufacturing equipment, the demand is recovering, but in Q2 there is a seasonality in Western markets, so the deficit increased. In industrial gases, continues to be strong, but from Q1 to Q2 there was an impact of the strong yen and also higher fixed expenses, and that led to the lower profit of ¥2.9 billion. In pharma, in Q1 it was ¥18.5 billion, in Q2 ¥22.9 billion, so an increase of ¥4.4 billion. In Japanese ethical drugs, there was an impact of the lower sales of the long listed products, but the Mounjaro sales grew, and the flu vaccine contributed to the higher profit and the revenue. In overseas ethical drugs, the North American Radicava sales continued to be strong, and there was a positive impact from Forex. MMA and derivative in Q1, it was ¥10.5 billion, in Q2 it was ¥15.4 billion, so up by ¥4.9 billion. MMA monomer in the first half, there was a tight supply demand balance in Asia, and from Q1 to Q2 the market prices increased, and the profit improved further with the price gap improvement. In basic materials and polymers, in Q1 it was minus ¥6.8 billion, and in Q2 it was minus ¥3.7 billion, so deficit was reduced by ¥3.1 billion. In materials and polymers, from Q1 to Q2, naphtha prices declined and the inventory valuation worsened, but the polyolefin and other price gap improved, and as the impact of the scheduled maintenance decreased, the profit increased. In carbon products, the coal and coke prices came down, the coke price difference or gap improved, and the inventory valuation worsened, so it was about the same as Q1. Next, about the revision of the full-year forecast for FY24. Now, the assumption for the second half is the exchange rate of ¥145 to the dollar and naphtha price of ¥72,000. Full-year sales revenue forecast is ¥4 trillion ¥470 billion, so compared with the beginning of the fiscal year, 3% lower sales revenue is expected, but the core operating income is expected to increase by 16%, so we are revising upward to ¥290 billion. The segment-wise information will be shown on the following pages. Special items in the second half, together with the business structure reform, we expect to book losses. We are revising the full-year forecast of minus ¥40 billion to minus ¥72 billion. As a result, operating income is expected to be ¥218 billion. Net income attributable to owners of the parent is expected to be ¥52 billion. Bottom line full-year forecast remains the same. Now, this page shows the core operating income first half results of the ¥172.4 billion, and the forecast of the second half, ¥117.6 billion, is shown. We'll explain by segment. First, about the specialty materials. First half, it was ¥24.5 billion. Forecast for the second half is ¥9.5 billion, so down by ¥15 billion. Display market in Q1, the utilization was high by the panel manufacturers, so we are likely to enter into the adjustment period. In the second half, our polyester film or POL film display-related products, we expect the sales to decline. Based on the EV demand trend in the Western markets, the lower sales of the battery material is also expected. As for the semiconductor market, at the beginning of the fiscal year, we expected the demand in the second half to recover, but aside from AI demand, consumer, industrial, and auto application are still weak, so we expect a similar trend for the second half. So, the second alf semiconductor-related material, as well as the precision cleaning service business, we expect about the same sales level as the first half. Also, there will be some delay from the first half, and we will have higher expenses in the second half, and also there will be an impact from the scheduled maintenance and repair. We expect the profit to decline in the second half. Industrial gases in the second half, due to the forex as well as seasonal impact, we expect a lower profit. In pharma, in the first half, it was ¥41.4 billion. Our forecast for the second half is ¥19.6 billion, so down by ¥21.8 billion. Out of this, about ¥16 billion is due to the higher SG&A and R&D in the second half. Radicava sales will continue at the high level, but in the second half, due to the forex impact, we expect a lower profit. MMA and derivatives, in the first half, it was ¥26.7 billion, and our forecast for the second half is ¥18.3 billion, so down by ¥8.4 billion. Starting with October in China, other companies, MMA monomer plant utilization rate increased, so the MMA monomer Asian market prices came down, and there's some trend of just making adjustments again. Although we expect some recovery of the market toward the end of the fiscal year, in comparison to the first half, we expect the profit to be lower in the second half. Basic materials and polymers, the first half was ¥11.3 billion. The second half forecast is ¥9.7 billion, so up by ¥1.6 billion. The deficit will shrink. Materials and polymer, there will be a smaller impact from the scheduled impact in Ibaraki, but with the lower naphtha price and the inventory valuation worsening and higher expenses, we expect the deficit in the second half. Carbon products, the carbon coke price will stabilize, and we expect the price gap as well as the inventory valuation to improve. In the second half, we expect the deficit, so we will continue to make efforts to reduce costs. Lastly, I'd like to talk about the dividend. The interim dividend payment for FY24, as we announced the forecast previously, we have resolved at the BOD on the 1st of November, the interim dividend payment of ¥16 per share. As for the year-end dividend, this is expected to be the same as our expectation, that is ¥16 per share. As a result, the annual dividend payment in FY24 will be ¥32 per share. As for the dividend policy for the future, on the 13th of November, we will have a briefing session on the management policy, and we will announce the new growth strategy as well as capital allocation. With that, I'd like to end my presentation. Thank you for your attention. Thank you very much, Mr. Kida. Now we'd like to open the floor for questions. First person with a question is Morgan Stanley MUFG Securities. Watabe-san, please ask your question. Y es, this is Watabe. Morgan Stanley, thank you. I understand that the start was very strong. Congratulations. New organization started from April. My question is, what has changed in terms of positive and negative? I'm sure that there are not many negatives, but can you please explain what the changes have been? Are you ready for the November 13th meeting? Are you perfectly ready? Can we have high expectations for that meeting? Mr. Chikumoto, please. Yes, thank you. We are steadily getting ready and working out the details as we speak. The biggest change we have observed is, if there are too many meetings, sometimes you would feel that maybe you're just doing meetings, not making money. But actually, even despite the many meetings, things are progressing forward very quickly. So we would like to continue to make fast decisions. That's all for me. Thank you. I'm looking forward to the meeting on the 13th. Thank you very much. それでは、次のご質問者の方を紹介させていただきます。 Next question from Daiwa Securities. We have Umebayashi-san, please. [Foreign Language] This is Umebayashi speaking. From the first half to second half, in many businesses, the profit is likely to worsen, but the carbon products, the deficit is halving. We mentioned that the spread improvement and the inventory profit and loss improvement was mentioned. Other than those factors, in the first half, there was an impairment loss. Amortization expenses being reduced is one of the factors. When you look at the sales from the first half to second half, it's less than 50%. I think that toward March next year, I think you mentioned this trend, but from the second half, is this something already starting and the sales volume coming down? Is that what we see or expect? Thank you. First half to second half, a trend of the carbon products. Kida-san, please. Yes, thank you for your question about the carbon products. Unfortunately, the first half, compared with the year before, the deficit expanded. Right now, how are we going to make improvements toward the second half? Let me answer to that question. First of all, the first half, what was painful was the inventory valuation loss. This was a major negative factor. The carbon products, one transaction lasts long, three months before we set the price, and then after three months, it will come in and we would make the COG and so forth. Something that we did in the past, there is always a time delay of three months or four months. Frankly speaking, there was some room for improvement in our operation, we learned that. A price gap, when the spread improves, as I mentioned, we would like to revisit the operation. As for the second half, about amortization depreciation, about this, it would increase in the second half because there was an impairment loss. The fixed cost, the repair and maintenance and capital-related, they will be handled. This amortization depreciation would increase. As you said correctly, this is not yet implemented, and from April, this will start, and we will continue to make COG. As for the lower sales, consolidate to Kansai Coke, which is the joint venture with Kobe, and these shares transferred to Kobe Co. was something that we announced. About this, about the ¥70 billion sales, consolidated sales were incorporated. This would be going away, and that would push down the sales revenues. I see. Thank you. Now it's clear. Just one thing, toward the next fiscal year, the second half, from the second half, the deficit, there will be a further improvement, and we will start to see the profit. Is that what we can expect in the next fiscal year? Yes, that's the image that we have. I see. Thank you. それでは、次のご質問者の方。 Moving on to the next question. SMBC Nikko Securities. Miyamoto-san, please ask your question. Thank you for your explanation. Thank you for the presentation. This is Miyamoto at SMBC Nikko Securities. I have a question about MMA. You provided us with some outlook for the market, but in the last month and a half, it declined very rapidly. What do you think is happening? And also, toward the end of the year, I understand that the market may improve, but where do you see the demand expectations? And also, investment in North America, please update us with the current status. And as for the operation, 70% in the first quarter, and then 80% was mentioned for the second quarter. So what was the actual utilization in the second quarter and what is the outlook for the third quarter? Please update us on the current situation of MMA. Thank you for your question. Kida-san, please respond to this question. Thank you. MMA, allow me to explain what's happening recently. In the first half, $2,100, so a very high-level trend. I don't think I need to explain the background. Demand was tight in China. nitrile utilization was low. Material was not being supplied. These are the major factors. And just before the major holiday, there was some manufacturing being done, but the tank was maybe overflowing, and the situation between demand and supply changed since then. But maybe the tank was going to overflow, and there was a lot of shipment, and then the price declined. So the prices basically went down because of the situation in China. And now the price is down. C4 manufacturers recently started to increase the utilization, but the price is actually coming down, and they cannot continue this operation, so they have to stop online, for example. So at the low-level price, they cannot continue to run deficit, and therefore the supply has to be adjusted. Now, the adjustment will go further, and during the second half, that is what we will see. In terms of demand, it is actually very difficult to see whether the demand will increase rapidly in the second half, especially for monomers, injector materials, or sheets. Whether it's Japan or Southeast Asia, the demand seems to be slow, sluggish, and we may see this situation continue for some time. As for the utilization, on average, in total, 75% was achieved in the first quarter. Sorry, 89%. 75%, this is for the joint venture. So across the board, approximately 89% or 90% is being maintained, and that's from July to September. And from October, we are expecting high-level operation. So for MMA, I know that compared to the first half, second half, the profit will be smaller, but it will not be a disaster. This is what we expect. Acetone price was quite low at one time, and the acetone shortage was maybe addressed, and that had an impact. ACH material cost has come down for you, so your margin would not be suppressed that much. Would that be the right interpretation? You are correct that acetone status has changed. Phenol and polycarbonate was bad, and acetone was quite tight, but now the situation has recovered, and there is an extra supply of acetone. But rather than the impact of acetone, ACH Chinese competitors, acrylic acrylic is used a lot, and nitrile is trending low still. And the nitrile situation, NBR, ABS, acrylic fiber, none of them are very strong right now. So acetone factor could be positive or slightly negative, but anyway, there is an impact. But more than that, the other material is going to have a bigger impact. Thank you. And can you please update me on the new investment for the new factory capacity? Yes, we're negotiating, and we should be able to decide relatively early what to do. But we are basically talking with potential buyers, potential customers, about the terms of the contract. We're negotiating the terms of the contract now. Understood. Thank you very much. それでは、次のご質問者の方を紹介いたします。 Next question is from Mizuho Securities, Yamada-san, please. Hi, Mizuho Securities. This is Yamada speaking. Thank you. About pharma, I have a question. Usually, the even month, the R&D and others would be booked, I think. That was a seasonality, but this time, the profit increased, and R&D cost is not increasing. Seasonality is not there. Could you explain the background? Is it the rebound from the weaker sales before? We expected the cost to come down, but lower profit is expected in the second half. Is there any one-time factor? Also, about the listing timing, ND0612 and other pipeline products are included for the oral drug. What is the probability of that? This is, I think, something that you might know the details. Could you talk about the launching of those products? Tsujimura-san, please. Yes, thank you. Your first question about the R&D cost, I believe. Usually, as we did last year in the second half, there are some special, non-special items, and also the R&D items, just like last year, and additional as well. As for this second half, as we made a press release, the additional testing was conducted. It will be conducted. The second half, the R&D expenses will be higher. Also, the second question, but the Canaglu and also for the Canalia, right, Canalia, yes, the possibility of getting approval, it's a drug. About the approval probability, I cannot give you a specific number, but we are continuing the development so that this product can be approved. ND0612, the cost increase. Is that going to be putting the negative pressure in the second half? There are several projects that are starting the clinical testing. The second half, the R&D costs would go up. It's not ND0612 only. In the pipeline, phase two to phase three, the ones that are moving toward that, it's not so many, but there are some starting in the clinical. Yes, there are several. The rebound is not something that we see, but rather the vaccine becoming available and the profitability might be low, but the sales is increasing for Manjero. Yes, Manjero is growing as expected, and the flu vaccine, Daiichi Sankyo, stopped providing the injection type and some withdrawal from the market. Our shipment has been higher because of that. Thank you. Thank you very much. それでは、次のご質問者の方を。Next question. UBS Securities. Oumura-san, please ask your question. UBSの大村です。 Yes, this is Oumura UBS. Thank you. [Foreign Language] I have an overall question. Specialty materials, volume impact. 説明会資料の7ページに拝見させていただくと、Looking at page 7, 今回プラスに上げられていますけれども、this is a positive number. 今回プラスに上げられているのは22年度の上期の水準と比べたらかなり。Compared to the first half of FY22, I think the situation is still quite bad. What would be the ideal volume trend and also capacity utilization? What is missing? What is the gap? Where do you see the gap and challenges in which specific products against what you would consider ideal? Thank you. Specialty materials, first half demand trend. Kida-san, please respond to this question. Thank you. [Foreign Language] I think you are looking at the difference of the difference. 差の差ってはっきり言って、 And the difference of the difference is not necessarily very accurate because maybe big gap against what we had in FY22, but it really depends on the product. So much variance between different products, and generally speaking, we don't see any major gap with any single specific product. In 2022, now, some of the products exceeded the performance of FY22 in the first half of this year. For example, display, you could consider this bubble. Why are the TV manufacturers making so many TVs? We may want to even question the situation. There's so many making so many. And talked about the Sorona. For Sorona, it's true that we have not really recovered to the 22 level, but compared to the disaster situation last year, we have seen a major recovery. Across the board, one of the big gaps is high function engineering plastic. The advanced material company is deploying this quite widely. Semiconductor-related products are recovering, so there's a huge recovery compared to FY23. But if we go back all the way to FY22, a lot of automotive applications existed, so that's a little bit slower now, and that is why there is not a high recovery compared to FY22. And the carbon fiber pressure vessel, this is not the market status, but fierce competition, and we are dropping some of the businesses because of that. That is why we're not seeing a recovery to the FY22 level in that particular segment. But generally speaking, we don't think there is a huge gap between what we are doing and what we had in 2022. I see. Thank you. Just to confirm, Sorona and the display have already exceeded the FY22 level or not? Display has already exceeded the level, but Sorona is a little bit lower than what we had in FY22. But in the first and second quarters, we are seeing gradual recovery, steady recovery. We believe that we will recover to that level sooner or later. I see. Thank you very much. That's all from me. [Foreign Language] Let's move on to the next question. JP Morgan Securities, Nakada-san, please. はい、JPモルガンの中田でございます。Thank you. Nakada speaking. すいません、私は石油化学のところで、more recently, utilization rate, what is the level? そして、7月のうちの後半の。 In July-September, the second half, there was one of the things that has stopped due to the other companies, but it's still 80% as an industry average. Kashima, I think it's pretty good, but what about Mizushima? From January to September, ethylene production added, compared with last year, production speed is lower. Maybe it's going to be below 5 million tons. Maybe I should ask this on the 13th, but in Mizushima, Setouchi, some discussion in Chiba, one or two. Excessive supply in Japan probably will not be solved. Could you talk about utilization and also the reorganization in petrochemical? Thank you. About the petrochemical utilization, Kida-san, please. Yes, thank you for your question, and thank you very much for your concerns. About the other companies, of course, we don't know the details, but as far as we are concerned, July-September, utilization is about or above 90%, it's very high. I cannot give you the details very much, but Ibaraki is much higher than 90%, and Okayama is a little bit lower than 90%, but late 80s, it's very close to 90%. We are maintaining that level. Our situation is like that. For the reorganization of the petrochemical, Chikumoto-san is a better person to answer that question, but Chiba Maruzen was mentioned, and Mitsui and Asahi Kasei, we are discussing with them from the beginning of the year. As we said before, within the end of the fiscal year, we should be able to show you some specific plans. はい、ちょっと。 Please answer your question. Just one thing about Okayama utilization being high, other companies, when they resume their operation, does it go down, or will it continue in the second half as well? 下期はですね、Well, the second half, overall demand has not yet recovered, so maybe it will come down a little bit, but as you said, Eastern and Western customers, the applications or the use are different. So I think you're right. So the trend in Japan is exactly what you described. わかりました。ありがとうございます。I see. Thank you. ありがとうございました。それでは、次のご質問者の方を紹介いたします。Next question. 野村証券の岡崎さんです。 No, more securities. 岡崎さん、please ask your question. Apologies. Thank you. Specialty materials, first half versus second half. There's going to be a big drop. You talked about the display and other factors already. Looking at Q2, it was better than three months prior to that. いろんな要素があると思うんですけど、I'm sure that there are many factors, but I think in the first half, maybe some of the factors were brought forward or happened earlier. I wonder. Is that a case? Maybe you've been conservative because of lack of visibility to the market. Is that true? I don't think this is just about the specialty materials, but structural reform is mostly focused in a big chunk of specialty materials. Three months ago, Mr. Chimoto, you gave us a very passionate comment, but in terms of structural reform, I have not really seen any progress in the last three months. Carbon fiber and the electronic materials, it seems that there are some struggles still. Looking forward to hearing something about that on the 13th. The specialty materials structural reform, in the last three months, what has happened? Can you please share that with us? Okay, first half versus second half. Can you please respond to this question, Kida-san? Thank you for your question. スペシャリティーマテリアルズ。 First half versus second half. Specialty materials business includes a lot of different products, so it's very difficult to generalize. But display, as we have mentioned already, during the first half, there was a bit of a bubble going on. Therefore, we expect to see some adjustment starting from the second half. That's included in the outlook. EV application, there is going to be continued lack of visibility in terms of battery materials and also electrolytes. We believe that the demand will drop toward the second half. I'm sure that you're paying attention to semiconductor. Semiconductor is growing. Everybody says that it's growing, but generative AI and the high-ticket products are growing, but in terms of volume, we have not really seen a full recovery yet. If you look at semiconductors, materials that are close to service sales will continue to stay strong from the first half to the second half. But when it comes to photoresist or real materials, this is totally dependent on volume. Therefore, from the first half to the second half, in the second half, we expected the demand to recover in the second half, and we will see bigger numbers. But it seems that the recovery demand may take a little bit longer than we had expected. Yes, we are applying a slightly more conservative view. This is a little bit different. Advanced materials, carbon fiber, composites and shapes, in this business, volume will continue to stay strong because of semiconductor-related businesses. In terms of profit, CPC's intangible asset depreciation was quite big in the first half. Some of them are only single-year impact. The depreciation will be much smaller in the second half, which should push up the overall profit. We have to take that into account as well. You may think that there's a big gap from the first half to the second half, but this explains why we have this outlook. The second half outlook is actually relatively conservative. Now, with regard to the structural reform, we are trying to pick up the pace of structural reform. That is the current status. For example, semiconductor cleaning business in general is quite solid. But looking at the details, some sites are still unprofitable. For example, in the United States, a closure of multiple sites may be decided within this fiscal year. Some losses actually have been already posted in the first half. With regard to the structural reform, we are basically trying to dig up all the long-buried problems and resolve them as quickly as possible, one by one. That is what we're trying to do. It's very clear. Thank you very much. I have high expectations. Thank you. We are running out of time, and with that, we'd like to end the Q&A session. Please give us your final remarks. Mr. Kida, would you like to say a few words at the end? Yes. Thank you very much for taking the time out of your busy schedule to join us today. At the full-year results earnings call in May, we said that those are the targets that we must achieve. In the first half, we exceeded those expected results. For the second half, in order to make sure that we realize the updated forecast, we will work the most. We try to improve the capital efficiency and profitability and take measures so that we can respond to your expectations. I hope you will continue to support us. Thank you very much. Thank you. Today's conference will be archived, and you'll be able to access it anytime from our website. With that, we'd like to end the earnings conference call. Thank you very much indeed for your participation.