Good afternoon, ladies and gentlemen. Thank you very much for joining us today. There are some couple of housekeeping announcements. Please connect with us with a device per person. Download the presentation materials from our website. We have English simultaneous interpretation during this event. If you wish to listen into interpretation, choose English from Interpretation Service button. If you would like to listen in English, please click the Interpretation button in your Zoom window and select English. If you have any questions, call us for help, 03-3218-5096. I repeat, 03-3218-5096. We'll be starting shortly. Thank you for your patience. Good afternoon, ladies and gentlemen, we'd like to start AGC IR Day 2024, Day 2. I am Ogawa from Corporate Communications and IR. I will be your emcee today. Let me explain what you should expect today. We will start off with our CFO, Miyaji, for his presentation of overall strategy of the group, followed by Momii, Chemicals president, and from Electronics president, Suzuki. From 5:45 P.M., Murano, Life Science president, will describe Life Science strategies. Each presentation will be followed by questions and answer session. If you have any questions, use the Q&A button at the bottom of your Zoom screen and enter your questions. Now let me invite Miyaji-san for his presentation. Miyaji-san, please. Thank you very much. This is Miyaji speaking. I will be speaking for about 10 minutes. Can I have my slide, please? So this is what I expect to cover today. Now, this shows the status quo analysis of AGC, as well as directions and key strategies. As you can see on this slide, AGC currently has the PBR lower than one, and we have to make sure that we improve on our ROE in order to achieve a PBR multiple of one. Business portfolio will be revisited for that purpose under the name of corporate transformation. With this, in 2026, we will have completed our midterm plan to achieve ROE of 8%. Next page, please. In terms of the capital cost and capital returns, as you see on the left, PBR at this point in time is lower than one, with our P/B and PBR being looked at separately, as you can see on the right. The average ROE of the company for the past six years is 4.8%. The 8% of capital cost is much greater than that figure. Therefore, we would like to bring ROE over 8%. In terms of PBR, over the past five years, we averaged at about 15.9x in this multiple. 17.4 is the average in the prime market. Therefore, the PBR is almost on par with the industry peers. Therefore, we have to make sure we enhance on ROE to attain more than 1 PBR. In order to realize that, we have defined multiple measures, as the red fonts indicate. As you will hear a lot about Life Science business, we have to make sure we achieve strategic growth in strategic businesses. On the other hand, in core businesses, as you will hear more later, in Display, for example, we still have challenges. Therefore, we make sure we accelerate our structural reforms for that. Eventually, we will get there in terms of our target for PBR. Now, these are the business indicators. In each of those businesses, we have these ROCE and EBITDA as indicators. The dot size indicates the size of EBITDA, and on the horizontal axis, we have ROCE. 8% of ROE is equivalent to ROCE of 10%. Therefore, we expect all the businesses to go over that level. Yesterday, we talked about automotive and architectural glass. Today, we will discuss Electronics, Chemicals, and Life Science businesses. As you will see in Display, 2026 is the target year for improvement. As you can see in the blue, in 2026, this is the expectations that we would like to bring all of those businesses. Electronics is an area where we have been making active investment. Therefore, enhancement and profitability, as well as business opportunities, will be the key. In Chemicals, Performance Chemicals is an area where we are making active investment, and by maintaining our ROCE, we shall strive to further enhance that business. Life Science, well, before pandemic, we expanded quite steadily, but then, because of the decline in the demand for vaccine, the business is a bit struggling. But then, once again, our challenge is to bring the ROCE of this business to over 10%. And today's presentation, I hope, will provide you with insight into how we may be able to achieve these goals. Next is about our capital allocation. On the left is the previous midterm plan between 2021 and 2023, in terms of cash in and cash out. On the right-hand side is a new midterm plan starting this year. In terms of our EBITDA, as well as cash flow, cash in of JPY 1 trillion level is expected. In terms of cash out, especially for the core business of Essential Chemicals, we are expecting to see some declines, and more of the investment for strategic business is going to increase. The dividend will be increased compared to the previous midterm plan. After all the necessary investment is made, well, as you see in the strategic investment, we will have the headroom of about JPY 200 billion, which can be used for new opportunities. If we do not find any new opportunities, we may consider share buybacks to increase shareholder returns. This is my last slide. ROE of 8% is the minimum to be able to cover the shareholder returns. In 2030, ROE of 10% is something that we aim for. In order to realize that, JPY 300 billion in operating profit will be necessary. As a milestone for that, for the current three-year midterm plan... We expect to have the operating profit of JPY 230 billion, with operating profit from strategic business of JPY 130 billion. This concludes my presentation. Thank you very much. Thank you, Miyaji-san. We now invite Tatsuo Momii, President of Chemicals Company, to talk about the Chemicals business. I'm Momii from Chemicals Company. Next slide. This is the table of contents of my presentation to talk about the Chemicals business. First, the scale of the business in 2023, net sales accounted for close to 30% of overall JPY 557.4 billion. Essential Chemicals and Performance Chemicals both contributed. This is the product flow of the Chemicals business. Soda ash is the raw material, and this was the start of our business. Over the ensuing 100 years, we have developed our business with electrolysis, and we have diversified products and increased the performance functionality of the products. Here you can see the performance of our business. In 2021 and 2022, our chloralkali market prices were high, and last year, as a rebound to that, we saw a decrease in profit. But both in Essential and Performance Chemicals, we have seen a steady increase in the size of the business over the past 10 years. And you can see that each contributed 50% in terms of profit last year. And this is the history of our Chemicals business. In 1917, we started the production of soda ash, which is the material for the glass manufacturing. This was the start, and we have placed emphasis on Southeast Asia. And in Performance Chemicals, we have launched various new products to expand our business. And from here, I'd like to give you the details of each sub-segment. First, the Essential Chemicals. The major products are alkali products such as baking soda and urethane products. Urethane-related products are the main products, and we do have the number one position in terms of manufacturing capacity in caustic soda, PVC, and hydrochloric acid. And in Essential Chemicals, we are operating in Japan and Southeast Asia, especially, our strategy is to focus on Southeast Asia, which is growing very rapidly. And here you can see the projected supply and demand balance of our major products in Southeast Asia for caustic soda and PVC, growing at around 4% a year. So, the demand is growing at larger rate than the production capacity, and therefore it has the potential of imports, and this is expected to continue. And therefore, in terms of our capacity increase, we will be concentrating on Southeast Asia to further expand our business. This is our vision and strengths: contribute to the growth and development of the region by providing a stable supply of products to the growing Southeast Asian market, with a high market share and stable sales and supply capabilities and stable production through advanced operational technology. That's the vision that we have. Strategy and measures. We will continue to focus in Southeast Asia in 2025 next year. The chlor-alkali capacity will increase next year in Thailand with the completion of the construction, and we are to enhance the linkage among the sites in this region. We will promote the digital transformation of our manufacturing plants for stable operation system strengthening. In terms of the sustainability management, we will study the deployment of biomass co-firing in our in-house power generation facilities in Indonesia, and we will conclude contracts to purchase electricity from renewables. This is the capacity and the market share in Southeast Asia. After the expansion of our capacity in Thailand for caustic soda and PVC for everything, we are to increase the capacity. So after the expansion, our market share in terms of the capacity should exceed 50%. This is for caustic soda, VCM, and PVC. From here, I'd like to talk about the Performance Chemicals. These are the major products. We do have the silica products, but most are the fluorinated related products, ETFE resin, and the polymers for fuel cells. In these niche markets, we have many number one positions in the world, which characterizes our Performance Chemicals business. These are the main demand sectors for fluorinated products. The characteristics are leveraged for different applications, diverse applications, especially electronics, semiconductor-related, transport equipment, aircraft and others, and architecture. In these three areas, we, they account for approximately 60% of our overall business, and this is the vision and strengths. We have a global network of manufacturing, sales, and product development functions, and therefore, we have a strength to incorporate the state-of-the-art, products, cutting-edge fields. So we are to contribute to the realization of the sustainable society and grow by further deepening and developing the technologies that we have to address the environmental and other social issues. As for strategies and measures, we'll be focusing on two areas. One is the semiconductor-related. With higher functionality of semiconductors, there are further expectations, and requirements in terms of the specifications of the materials, in terms of heat resistance and others. Therefore, the demand is increasing for the fluorinated products. Our fluorinated products and rubber, these conventional products, are expected to see expanded growth and a fine silica, and other new products will be launched for new areas, including 5G communication. Another focus area is hydrogen-related market. The ion exchange and membrane plant in Kitakyushu will be expanded. As we announced very recently, we do have our own technology of ion exchange membrane using hydrogen, and we also have the electrolysis polymers. Based on these two, we are to contribute to the upcoming hydrogen-related society, and this is the medium-term earnings concept. Currently, semiconductor and hydrogen-related business account for 5%, but this is to increase to 20% by 2030, so as to achieve the net sales of JPY 300 billion or higher in 2030. These are the targets for Essential Chemicals. We have the strategy of concentrating on Southeast Asia for Performance Chemicals. Electronics and environment energy areas are the growth areas. For Essential Chemicals, about 10% ROCE, and Performance Chemicals, 20% or higher for the operating profit of JPY 86 billion in 2026. For Performance Chemicals, PFAS regulations is considered to be a challenge, and therefore, I'd like to address that issue before I close. In February of last year, the draft REACH regulation was announced. The deliberations are still underway, and therefore, the details of the regulations are still unknown. What AGC can say as of now is most of the products of AGC are included in a large definition of PFAS. As for the listed substances, PFOS, PFOA, and PFHxS, for these three substances, we have totally eliminated our products, or we don't have the record of production or sales to begin with. To fulfill our social responsibility, we are working on minimizing the footprint, and we will continue to contribute to the environmental issues. As for the regulatory trends in Europe, the authority in Europe is spending more time because the scope is considered to be larger than what was expected. So with that, I'd like to conclude my presentation. Thank you very much for your kind attention. Thank you, Momii-san. We will now move to the Q&A session for the Chemicals business. If you have any questions, please click the Q&A button and type in your questions. We'll first look at the questions that we received in advance. The first question is on Essential Chemicals. In order to reduce the performance volatility, what initiatives are you implementing? And in order to lower the break-even point, do you have any initiatives that you are implementing? These are the two questions. Thank you for your question. Regarding the performance, yes, it will be affected by the volatility in the market, but within the Southeast Asia, where Essential Chemicals is focusing, we do enjoy high market share and presence, and therefore, we believe we are successfully managing the impact of the market situation. For example, we do have a very good distribution logistics network within the region, and that is serving as the entry hurdle, and therefore contributing to lowering the volatility. Next question is also about Essential Chemicals, about the demand and supply of chlor-alkali in Asia. The biggest importer, India, of PVCs, are likely to strengthen its re-regulation over Chinese-made products. Will that impact chlor-alkali demand and supply in Southeast Asia? Well, thank you very much. The Chinese products going to India can be diverted to other Asian markets, but there is another aspect to it. Instead of Chinese-made products, Japan, Korea, and Taiwan-made products will increase as exports to India. Therefore, that also has an impact to the dynamics. Although we will expect some short-term disturbances, that will be limited to the temporary factor. Thank you. Next question is also on Essential Chemicals. What will be the impact of capacity enhancement in 2025 on the demand in the region, especially regarding PVC? Currently, I understand that there is import, more import, but based on the data at hand, your capacity increase would almost be equal to the demand in the region. While it is not likely that PVC demand in China will recover over a short term, would there not be an impact of your expansion to the demand in the initial year? Thank you for the question. As explained in my presentation, the new facility is to be completed next year, and so from the second half of next year, we expect a full-scale operation. As for the China impact, it's not likely that the demand is going to recover quickly, but we are sticking with our current plan to start the operation. Because looking at the demand in Southeast Asia and India, they're still very strong, and therefore, regarding the start of our increased capacity in Thailand, we believe overall could be absorbed in the demand in the area. The next question is also about Essential Chemicals, and this one is about profitability. Page 21, would you show the slide 21? And this shows the Performance Chemicals net sales, as well as last year's comment are combined in my analysis. It seems like you're assuming 5%-6% of Essential Chemicals' operating profitability in around 2026. Are there any factors which could bring down your profitability, for example, depreciation cost? Or are you being conservative? Momii-san? Thank you for the question. Well, because of the increased capacity in Thailand will be ramped up, therefore, it is true that we will see increased depreciation cost, but that does not translate directly to operating profit declines. Our targets in Essential Chemicals that I discussed earlier would be ROCE of 10%. Thank you. Next question on Performance Chemicals. Slide 17. Slide 17, please. There, you are showing the net sales for electronics, transport, equipment, architecture, and others. Are there differences in terms of profitability, or as shown in slide 31, are the profitabilities different depending on the tiers? Thank you for the question. On slide 17, we are showing different applications, and yes, the profitabilities differ. And, the reason being, that, for each application, there are certain products, that are tied to, what we, manufacture. And so the profitabilities, differ. Now, are there tier-based differences in terms of profitability? The answer is no. Rather, the business environment or the competitive landscape in each application is a bigger factor. Thank you. Let me go on to the next question. This is about Performance Chemicals. Slide 19.... The question is related to slide 19. Now, this shows the capacity increase. How much of the production capacity increase are you expecting? And the increase is used for the increasing demand for semiconductors? Thank you. On slide 19, we were talking about high performance products capacity increase. Now, with this investment, our production capacity will be increased by about 20%. Now, this increased capacity, not all of it will go to semiconductors or the hydrogen that I talked about earlier. There are other applications, and in existing applications, we expect some market growth as well as replacement of our competition. That's how we plan to increase our sales with this increased capacity. Thank you. Next question. Again, on Performance Chemicals, slide 19. On semiconductor-related products, specifically, what are the products that you are talking about? With higher communication speeds, the significance of low dielectric constant and a low dielectric dissipation factor materials would be more important, especially for AI servers. So, would significance of a fluorinated substrates increase, or are you already seeing an increase in demand? Thank you for your question. For semiconductor related, we do see high presence of a fluorinated resin for semiconductor manufacturing devices, as well as mold releasing films, ETFE films, used in the semiconductor manufacturing process. With the growth in the semiconductor market, we expect growth in sales as well. With the higher communication speed as for the future, the requirements on the part of materials in terms of electric capacity requirements low dielectric constants and lower dielectric dissipation factors would be required. Therefore, the areas where these could be leveraged would be a PCB. The new product, EA-2000, we believe, can contribute to addressing those needs. As for non-fluorinated areas, fine silica, which is also part of our Performance Chemicals, for the inorganic fillers, this will play a significant role as well, and therefore, its significance is expected to grow. Another question about Performance Chemicals, about slide 38. Thank you. Now, inorganic filler silica. In some sealant manufacturers, they're planning to replace their liquid type of HBM sealant to granular type, but then the granular type has a bottleneck that is the challenge of making filler size smaller. Is your solution would be the answer to this challenge? Momii, please. Thank you very much. Well, actually, our silica for inorganic fillers for the cutting-edge semiconductor packaging, we are receiving lots of leads and inquiries. I cannot discuss the details of what our customers would like to have, but overall, existing silica fillers are to be replaced for the purpose of higher electrical as well as mechanical performance. That's what is expected out of our silica for inorganic filler. Thank you for your question. Thank you. Moving on to the next question. AGC is collaborating with Mitsubishi Gas Chemical Company to work on the production and sales of the environmental circular type methanol manufacturing equipment using CO2. We understand that CO2 emitted at Kashima Plant is to be used. So in what way are you going to collect CO2? That's the first question. Is it chemical absorption, physical absorption, or membrane separation? And the second question is, what percentage, I mean, what is the concentration of CO2 that could be collected, and what will be the cost of collection? Thank you for the question. We have started a discussion with Mitsubishi Gas Chemical Company, the CO2, which will be used as the material. How are we to collect that? Which is your question. As you point out, there are several options. At this current moment, we have not yet identified one. We are studying all possibilities, and therefore, what is the concentration of CO2 that could be covered? We can't give you a specific figure right now, but, CO2 collected will be used as raw material, and therefore, higher concentration would be the better, of course. So, we would like to think of the collection method that will contribute to higher concentration. As for the collection cost, since the method of collection or the size have yet to be identified, the cost is still unknown. Thank you. We're still accepting questions. Use the questions and answers function at the bottom of your Zoom screen. Now, about Essential Chemicals, we received a question: "What is your thinking of investment after your investment in Thailand? And what will be the investment discipline for the future in order to attain your ROCE targets?" Momii-san, please. Thank you very much. After Thailand, our investment in Southeast Asia, well, at this point in time, nothing has been decided. As I mentioned earlier, in Southeast Asia, we expect healthy demand increase, therefore, the import will be greater than export for some time. Therefore, it is viable to think about next rounds of investment, but we still have to be vigilant about the environment of the market. So at what timing and where to invest for the additional capacity is something that we will have to continuously explore, and we certainly hope to do so to make appropriate decisions. As for ROCE, we have the set goals of ROCE, which will be the basis of our investment decisions. Thank you for your question. Next question: "For each sub-segment, how would the first half and second half compare? In addition to general trends, what is the projection for 2024 for AGC? Thank you for the question. So for each sub-segment, I would like to give you the following answer. For Essential Chemicals, generally speaking, the Southeast Asia, where we focus, for that region, for the first half, there were Chinese New Years, Tet, and Lebaran, long vacation time. Our facilities do have the maintenance turnaround, the regular maintenance and repair activities being scheduled, and therefore, they are having impact on our business for the first half. As for the second half, as for the Performance Chemicals, the same applies. Rather than Japan, on a global scale, we operate. So, Chinese New Year and other vacation time would have impacts, and, as was the case, with Essential Chemicals, we do have the maintenance turnaround, the regular maintenance, repair schedule for first half as well. We have many rapidly growing businesses, and they are expected to continue to grow. So on a full-year basis, second half tends to be better than first half. That's the general characteristic of Performance Chemicals. And therefore, both Essential Chemicals and Performance Chemicals tend to have better second half than first half. Next question: "Certainly, the market will have impact to your performance, but what will be the expected stable operating profit level? In 2023, for the entire Essential, you had 10% of operating profitability. Is it something that you are expected to maintain?" As for the operating profitability, it's not only the market that determines that, therefore, I cannot give you any quantitative answer concretely. But 10% for Essentials, or of 10%, it is two. But at this point in time, we do believe that the chlor-alkali's bottom has been already hit. Therefore, it is not likely to decline further, making us confident that we can maintain at least 10%. Thank you. Thank you. Next question: "About the reorganization of petrochemical business in Japan, although this is not, your business area, could you briefly explain the current situation, and what is your view on what is happening now? And what kind of scenario and timeline are you assuming?" Thank you for the question. Our Chemicals Company have plants in Chiba and Kashima. At Chiba, at the Chiba Plant, is part of Keiyo Rinkai Combinat, and Kashima Plant is part of Kashima Combinat. And as is covered in news media, we are aware that there is a move towards reorganization of that industry, including the need to address carbon neutrality. So we are communicating closely with each company, and we are concentrating our efforts in collecting the information. Thank you. The next question. Now, in Southeast Asia, about chlor-alkali products, we received a question. The demand expansion of chlor-alkali in Southeast Asia, how long will it continue? Momii-san? Well, in Southeast Asia, the expected demand increase of chlor-alkali is something that is difficult to foresee, but at least it depends on the economic growth of the region. As long as the economic growth continues, demand is likely to increase. We do expect high economic development in our caustic soda as well as PVCs for the mid- to long-term, we can expect long-term expansion. Thank you. Thank you. Next question. In India, anti-dumping programs are expected. What will be the impact? China market, which cannot go into India, might enter Southeast Asian market. Wouldn't that hurt the market price, is the question. Thank you for the question. Yes, that risk is there. We are aware of that risk, but the supply and demand might change temporarily. But when we look at the overall demand in Asia, including India, we expect over the long term to grow. So even when Chinese products are to enter the Southeast Asia market, other products will, or the products from other countries will go into the Indian market, and therefore, the balance will be maintained. We are still accepting questions. Use the questions and answers function to enter your questions. Next question is about Indonesia coal-fired power plants. What is the operation rate of that, as well as future plans? You're making efforts for mixed combustion with biomass. What is your expectation of that attempt? Thank you. Now, as for Indonesian power plants, using biomass in mixed combustion, GHG emission will be reduced, and this is something that we will be doing in full-fledged manner in the future. In the future, when the power generation factor declines, we can try and switch to low carbon footprint fuels, CCS, CCU. Possibilities will also be explored. Thank you. Next question. Other businesses of AGC, for instance, architectural glass. We get the impression that Southeast Asia, including Thailand and Indonesia, are not doing very well economically. Why is it that the demand for Chemicals is strong? Thank you for your question. It's not just limited to Southeast Asia, but chloralkali products are the basic source material for many different chemical products, and as a result, in many industrial areas, it's used in many diverse applications. So it does not rely on single industry. That is the structure of the business, which is one of the strengths of this business, especially within Southeast Asia. Caustic soda or nickel battery, that demand is very strong. Thank you very much. Now, we have exhausted questions that we received. Are there anyone else who may have additional questions? Well, if not, I think we can conclude this session. Momii-san, thank you very much. Now, next will be electronics briefing. We will start the session at 5:00 P.M. 5:00 P.M.... Thank you for joining us at AGC IR Day. We will be resuming the session shortly. From 5:00 P.M. sharp, we will start the briefing of Electronics business. We will be starting shortly. Thank you for your patience.... It is time, ladies and gentlemen. Let us begin our briefing on Electronics business. I'd like to invite Suzuki-san, the company president. Over to you, Suzuki-san. Good afternoon, ladies and gentlemen. I will go through these items in this agenda related to our Electronics business. Here is the overview of our Electronics business. Our sales last year landed at JPY 313.2 billion, accounting for 16% of AGC Group's net sales. Out of two segments within the business, Display segment did slightly better than Electronic Materials segment. Now, bars in this chart indicate the company's sales by segments, and the line, operating profit. Electronic Materials in dark orange have shown a steady growth. On the other hand, Display business over the past two years struggled after increased demand during the pandemic, recording losses and causing large decline in profits, but came back last year with a moderate improvement. This is a map of Electronics Company's presence with main manufacturing sites. TFT glass are mainly produced in China, Taiwan, Korea and Japan. Electronic Materials sites are in the U.S., Thailand and Japan. Optoelectronics are largely manufactured in Thailand and Japan, whereas blanks in Japan and CMP slurry, mainly made in Japan, to be also used in the U.S. Let me now turn to challenges and strategy for Displays. This segment includes glass substrates for TFTs and OLEDs, and chemically strengthened specialty glass used for cover glass of smartphones and other products. Our clear challenge is to improve profitability and our ROCE. Our profitability suffered in 2022 and 2023 as our sales declined after the pandemic-induced demand increase, as well as material price increase, and the yen weakened. Improvement measures are three-pronged: revising pricing policy, enhancing competitiveness with innovation, and structural reform with greater focus on large-sized Display panel glass substrates. Let's talk about the first two. We raised our price last year in response to soaring prices of raw materials and fuels, and increased cost of production due to the weaker yen. We continue to ask for our customers' understanding this year. In the innovation front, we plan to launch competitive new products and to adopt equipment with high combustion efficiency to enhance competitiveness. Structural reform has been ongoing to improve profitability, and as we announced in February, we started project to accelerate the reform with our CFO leading the endeavor to focus more on the large panel glass substrates. We've already partially exited from low-profit, small to medium-sized panel glass and suspended Takasago line for LCD glass substrates. We will be reducing our capacity about 20% by the end of this year. During the midterm plan, we aim at achieving ROCE of 10%. Next is our strategy for Electronic Materials. AGC's strength in this segment include having both organic and inorganic materials and processing capabilities, and excellent design, evaluation, and analytics technologies. Combination of these factors enable us to offer AGC unique solutions. Blanks were productized, combining synthetic quartz as a material, precision coating processing technology, film design, and analytical capabilities. We make slurry for semiconductors from its materials, with advantages of having both organic and inorganic materials in-house. As for the semiconductor packaging substrates, we will further leverage our existing capabilities. Major products for semiconductors include EUV mask blanks, CMP slurry, synthetic quartz, which dominates the lithography market, and copper clad laminates for PCBs. Optoelectronic Materials include our flagship IR cutoff filters used for photographic color compensation, DOEs and diffusers for sensors, highly refractive glass for AR/VR applications, as well as aspherical lenses for cameras. A little more on some major products, starting with EUV mask blanks. We are the only integrated manufacturer in the world that can respond to customer need in any part of the production process, and proactively offer our value propositions. Active investment is planned to respond to the demand and to maintain competitive advantages in the next generation products. EUV mask blanks market is highly correlated with the shipment of lithography equipment, which remains solid. Higher integration of the chip translates to more layers of lithography, leading to further growth of the market. Our original sales target of JPY 40 billion in 2025 may be attained this year. CMP slurry is made from abrasive grain material, and our end-to-end production ensures high quality products and solution development in partnership with our customers. Slurry consumption is affected by the level of chip making, but our products are often used for next generation semiconductor products, and thus are outperforming the CMP slurry market. With this slide, I will describe our strategy for the IR cutoff filter out of our optoelectronic products. As the bottom of the slide shows, the image sensors in camera receives different colors from what human eyes would see. The IR cutoff filter compensates for the colors to make match with what we see. Smartphones and digital cameras use these technologies. Our strategy is to build and forge partnerships with demanding customers, who would appreciate our technological progress, and to add further value to highly functional cameras, especially in movie performance. Our solutions can add value to our customers' products. I will now discuss our new business opportunities. On the left, are the semiconductor-related components. We will explore opportunities in ever more important packaging solutions. An example here is glass substrates for chiplets, replacing the current mainstream resin substrate. The next generation will have glass substrate instead. On the right, in the optoelectronic domain, we are looking deep into new opportunities in AR/MR-related components, as well as novel optoelectronic materials required for automated driving and higher performance of vehicles. Lastly, let me share with you our goals and objectives. This year's net sales target of JPY 330 billion, against last year's JPY 312 billion, and operating profit of JPY 33 billion, against JPY 18.4 billion last year. Both top and bottom line growth are planned to continue into 2026, with JPY 380 billion in net sales and JPY 53 billion in operating profit. Our ROCE target for 2026 is 10%, with profitability improvement measures, and Electronic Materials tend to boast high ROCE, which will be maintained for this period of midterm plan, centering around semiconductor-related offerings. This concludes my presentation. I thank you for your attention. ... Suzuki-san, thank you very much. Now, let us move on to questions and answers for Electronics business. Please use Q&A icon to enter your questions. Now, let us begin responding to questions that we received earlier. The first question is about Displays. In 2024, additional 10% of capacity decrease is planned for Displays. What will be the timeline, and where would that downsizing happen? Do you think this will make your production capacity more appropriate? Suzuki-san, over to you. Thank you very much. As I explained earlier, as for the production capacity compared to 2022, this year, we'll have 20% less in 2024. Last year, in 2023, we suspended a line at Takasago. We have already, with this, reduced the capacity by about 10%, and this year, we will have another 10% decrease. That's what we plan to do this year. In terms of the appropriate level of production capacity, we have to be very watchful of the market all the time in order to determine what is the most appropriate level, and we certainly intend to do that. Where to downsize is not something I can disclose at this point in time. Thank you for your question. Thank you. Next question. Again, on Display. It is expected that Display business will finally turn to profitability in 2024, but the hurdle of ROCE of 10% or higher sounds pretty challenging. What do you think? Thank you for your question. Already, regarding prices, since last year, we have been revising, raising prices. This year, we are continuing to ask for the understanding on the part of the customers to accept the price increase. And as I mentioned earlier, we are optimizing the production capacity, so we are already seeing certain effect of the structural reform efforts. And this year and onward, we are going to be launching technology innovation products, and these are to have effect so as to achieve our target of ROCE 10% or higher. We haven't reached that point yet, but, by implementing the measures that I mentioned, which should bear fruit, we are maintaining this target of ROCE 10%. Thank you. The next question. Now, price increase of Displays. Compared to three months ago, is the price coming up? We continue to see weakening of the yen. Even with your structural reform, it may be difficult to raise your profitability, and also, your competition is pointing out the possibility of 20% price increase in 2025. Do you share that view? And what is the probability of being able to do so? Thank you. Now, in terms of price increases, as a track record, starting from the third quarter last year, we have been able to reprice our products. We will continue to ask our customers to accept the price increases, and we are seeing some impacts. And of course, the depreciation of the yen appears to continue, and that will be an important factor behind our asking our price increase of our customers. Now, you mentioned our competition's mention of their price increase. I cannot comment on that, and I cannot comment on the exact level of price increase of our products, but we will have to continue to try and do that. Thank you. Thank you. Next question on Electronic Materials, on EUV mask blanks. In 2024, the net sales of JPY 40 billion or higher is expected, you said. So what are the reasons for this major change in your projection? Thank you for your question. For 2025, we were aiming to achieve JPY 40 billion or higher. So we now feel that this could be achieved a year earlier. The big factor, the biggest factor is more than we expected, demand on the part of the customers, was strong. Well, that's EUV mask, EUV lithography of products, development efforts, all of these are increasing. Yeah, as for the EUV mask blanks, if your customer base is expanding, what is the background for being able to expand the customer's wallet share? Is it because your customers are choosing double sourcing of device manufacturers?... Well, as I mentioned earlier, we have the end-to-end process starting from glass, and that is highly appreciated by our customers. We have high quality, and we have technologies to respond to the demands of the customers. We have been able to expand our share of the market. In EUV, we have business with all the lithography using customers. So as we see the mask demand increase, we expect our business to increase. Well, as for the double sourcing, that is a policy of our customers that will totally depends on our customers. Thank you. Another question on Electronic Materials for IR cutoff filter. Currently, with the slow growth in smartphone demand, the down, or the downward trend is being observed. But at the same time, on a medium term, with the increase in number of, front cameras and larger size, this may contribute to greater demand, added with the application for automotive use. Are you going to benefit from these growth in demand as well, is the question? Okay, front camera, and automotive application cameras, would we benefit from that? Yes, with increased size, that would mean the market will grow. As for automotive applications, we are trying to increase the number of customers that adopt this. And, for infrared cut filters for automotive applications, with the autonomous driving and others, for lenses and sensors, there will be more applications, which would be another plus for us. And plastics. In the automotive application, the reliability is very important, and therefore, glass is still a priority. Next question is about Glass Core. Would you give us up to date on your development of Glass Core? It seems like in Korea, they would like to ramp up for the mass production in 2026. Technologically, is it feasible? Suzuki-san, over to you. Thank you for the question. As for the Glass Core, we are making a full-fledged development effort to make it a solid business. Glass Core for AI servers is something that the market is expecting a lot out of. Many customers are hurrying to start mass production, I would believe. And for us, it means increased leads and inquiries about Glass Core. In terms of our development, TGV, the small through via creation, that's something that we have been working on over the past decade or so. Therefore, we are quite advanced in the stage of development. We will further accelerate the development efforts to make contributions. Now, mass production in 2026. Well, as we listen to industrial players, after 2025, there will be lots of activities, but probably mass production will have to wait until 2030. But as I mentioned earlier, this is an area where all the players are hurrying to start mass production. Our accelerated development may be able to fuel that. Next is on CCL, copper clad laminate. We think that business is suffering. Are there any measures to make a breakthrough in this current situation? Thank you for the question. For CCL, the questioner said that we are facing a difficulty. Well, with regards to the transfer of manufacturing process and consolidation, all the measures are being taken for the establishment of a globally optimized production structure. And as that type of a structural reform has all but been completed, so we'll now work on improving the productivity, as well as to reduce the fixed costs, so as to improve the profitability. As for CCL market, last year, semiconductor market, compared to the previous year, was declining, but this year, the market is growing over the previous year. And in relation to that, the CCL application areas, we are seeing demand growth in those applications as well. So with the optimized production, system, with the increased sales, we expect profitability improvement. And also going forward, further, refinement, in performance will be made, and therefore, we are developing products for that kind of application, for example, for energy saving purposes. Thank you. Let us move on. About CMP slurries, it's a general question. Some semiconductor manufacturers are planning to reduce the number of processes in CMPs. Do you see that trend from your perspective at AGC? And also, some slurry manufacturers have pointed out the emergence of local manufacturers in China. Have you also seen that? And I would also like to hear about your business opportunities in hybrid bonding. Over to you, Suzuki-san. Thank you. As for the CMP process reduction that was mentioned in the question, actually, it means smaller layer counts. Well, we are not promoting that. I don't think the manufacturers are promoting that. As for the Chinese manufacturers... Well, the decoupling between the U.S. and China, as well as supply chain being built in China, certainly has implications in terms of the increase in the local manufacturers in China. We see that trend as well. Well, as for hybrid bonding, 3D and 2.5D type of slurry usage, well, I think the application is likely to increase. Therefore, there are business opportunities. But then, this is an area where everyone's just moved from drawing board to prototyping. So this is a new area of opportunities, I would say. Thank you for your question. Next question will be on Display business. Regarding demand, the final demand for TV sets does not seem to be strong, and panel manufacturers' utilization rate improvement efforts seem to be taking place already. So what is the risk of another inventory adjustment phase to take place in the second half of 2024 and later? Thank you for your question. In terms of the number of sales of TV sets, it has been declining year-on-year, this year and last year, or last year and the year before. Whereas for this year, we expect a slight increase year-on-year. And also, the panel size is increasing, so in terms of total demand for glass, it's growing. The panel manufacturers' utilization rates improvement efforts, the questioner said that they are leading in that. We can't capture all the situation. Compared to last year, the inventory on the part of the panel manufacturers has been under control. It's reduced. For the second half onward, would there be another inventory adjustment phase? It's hard for us to say at this point in time. Whatever the situation is going to be, as I said earlier, we will continue to work on improving the profitability. Thank you. The next question about Electronic Materials. Now, about EUV mask blanks. You mentioned that you are likely to achieve JPY 40 billion this year, one year earlier than your original target. Now, in 2025, do you think you will see a similar growth of 50% to reach JPY 60 billion? Are you comfortable with this prospect? Suzuki-san? Well, as for EUV mask blanks, the business growth, as I mentioned earlier, will get us to JPY 40 billion this year, one year earlier than the original plan. Next year on, the demand is likely to increase in this domain, but I cannot really talk about the numbers. Sorry about that. Thank you. Another question on EUV mask blanks. Phase shift mask is already on the production line for DRAM application. I thought that the state-of-the-art logic would be the first adopter of phase shift mask. Are the requirements different between DRAM and logic in terms of specifications? And what is the backdrop to DRAM being the adopter? Thank you for the question. I think it all boils down to what our customers are thinking. For memory, yes, that's for sure. For logic... Well, in a nutshell, to make a finer refinement, I think that could be used for binary, I think is the thinking on the part of the customers. And should this continue, then phase shift mask for logic? I think the logic customers would adopt phase shift mask as well. I cannot give you the details of the customer information, though. Thank you. Those of you who are asking your questions, please use the Q&A button and enter your questions in that field. Thank you. Now, let's move on. Once again, about EUV mask blanks. Now, the trend in 3 nm in EUV mask blanks was mentioned at the time of our first quarter earnings call. What will be the adoption after 2 nm in technological roadmaps? Right, we talked about that in 3 nm world, and specific customers are already working with us in further development. After 2 nm and onward, we do have multiple development projects, and multiple customers are likely to adopt EUV mask blanks in 2 nm. Now, new trials in film de position will have to be developed further. Thank you. Next question is on Display. Is it very difficult to change the commercial practice of setting the sales prices on the yen terms? Is the question. Thank you for the question. Historically, the Display prices have been based on yen basis. That's because of the relationship with our customers, and looking at the industry overall, there are competitors that we need to take into consideration. So yen-based selling price, we don't see any signs of this changing. Thank you. The next question, also about EUV mask blanks. So you front-loaded the target achievement of EUV mask blanks. Is it because of mask houses or fabs customers increasing the purchase? AGC is ahead of the pack in this area, do you think? Well, that's a difficult question to answer, as a matter of fact. Mask house is, well... Well, in terms of EUVs, all the customers make their masks in-house. And we cannot have a way of knowing what sorts of application they have, therefore, we do not know. And what was the second question? The phase shift mask development, and is AGC leading the pack? Oh, I see. Okay. Now, our competitors are working very hard in this area, therefore, I cannot compare us against our peers. We are not behind, but, we cannot tell you whether we are leading or how much. But evaluation and prototypings are progressing very smoothly. Thank you. Next question, again, on EUV mask blanks. The AGC production capacity will increase in 2025, I believe. And do you think that capacity increase is sufficient to address the growing market? Is the question. Thank you for the question. Our EUV mask blanks production capacity, it's not 2025, but in response to the market situation, we have been expanding the capacity, so it's not limited to 2025. So going forward, with the market growth, with projected amount, we would be expanding our capacity accordingly. Next question is also about EUV mask blanks. Your upside changes. Is it because of the usage in development or for mass production? As you front-load your achievement of your JPY 40 billion target, what sort of an implication will it have to your share of the market? Right. Thank you. Well, actually, it totally depends on the demand from our customers. Overall demand increased than we expected, both for development and for mass production, as we understand it. As for the share of the market, I do not think I'm in a position to be able to discuss that. As for mask blanks, we do not really regard the share of the market to be very important. We would like to supply quality products for the next generation products of our customers. Thank you. Next question, again, on EUV mask blanks. What are the differences in characteristics that are required for logic and DRAM applications? And in addition, we see an increase in pellicle adoption. What is your view on the decrease in the usage frequency of mask blanks? Logic and DRAM, the required characteristics, when we compare the two, as far as mask blanks are concerned, there are no difference, much difference. And as for pellicle implication, true, in terms of, defect in semiconductor wafer production, as the defect declines, the usage might go down. But, with the use of pellicle, the throughput would go down, and with that, there is a possibility that the number of, blanks used would, increase, and therefore, we do not consider this to be a negative factor. And also, at AGC, we assume that multiple customers are already using pellicles, and, that is taken into consideration as we make the demand projection. So its implication, there will be an improvement, in pellicle itself, so that is part of the factor. Thank you very much. Next question is about Display business. NEG, your competitor, is now working on the full electric melting furnace. What is AGC doing to reduce GHG emission overall? Right. Glass melting furnaces. We have shifted from heavy oil to natural gas in terms of fuels and combustion. Air combustion to oxygen combustion transition has been done to reduce GHG emissions. As for fuels, as well as the use of electrical furnaces, that is in our future plan. In 2030, GHG emission reduction of 30% is something that we have set as our overall goal of AGC, and that is our target as well. Thank you. I'm afraid our time is up. So with this, we conclude the Q&A session. Thank you, Suzuki-san. Thank you for your attention. We'll take a five-minute break. We'll come back at 5:45 P.M. to start the session on Life Science strategy. It's now time to resume the program on Life Science business. President of Life Science Company, Tadashi Murano, will present. I'm Murano from Life Science Company. Thank you for joining us. I'd like to go over the Life Science business very briefly. So this is the business overview. As you can see here, net sales on the left-hand side, and on the right-hand side, you can see the main business areas. Basically, two. One is small molecule pharmaceuticals and agrochemical CDMO, and the other is biopharmaceuticals CDMO. In terms of services that we provide, you can see the details on the slide. Next slide. This is the financial performance history. As you can see here, in 2018, from there to 2022, over 30% growth annually has been achieved. But for 2023, as you can see, we saw this growth being stopped, suspended. The reason is cited here. In a biopharmaceutical CDMO, the market situation worsened, and also for biopharmaceuticals, the new line launch in the U.S. has been delayed. Also, major investments cost that had been planned are pressuring our profit, and that is the reason why we saw a decline temporarily in 2023 year-on-year. As for the breakdown of sales of Life Science, as you can see, 70% is biopharmaceutical CDMO, 30% is small molecule pharmaceuticals and agrochemicals CDMO. This is the history of our business. You can see the details here. In 1973, Life Science team was launched, and we started the business in 1985, especially in biopharmaceuticals in year 2000. For protein CDMO, we started on the full scale, and since 2016, mainly relying on acquisitions, we have expanded the CDMO business. Next, I'd like to talk about the current situation. Slide eight. As mentioned earlier, especially in biopharmaceutical CDMO, the situation is as follows: bioventures, which are the customers of our biopharmaceutical CDMO, in 2013, the funding inflow impact has been felt, and that is continuing. We are seeing a recovery trend somewhat, but as for the rate of recovery, we are not very optimistic over a medium to long term. Given the supply and demand situation, we are certain of the recovery. However, with regards to the recovery for this fiscal year, we feel we have to be rather cautious, and depending on the situation, or in response to these situations, we have implemented various initiatives. Last year, the biopharmaceutical CDMO Colorado plant operation did not operate. Almost no operation last year, which had major impact on our performance, but commercial operation resumed this year. So for this year towards next year, this should contribute to recovery in our performance, which are described on this slide. As for the new line launch, from now towards next year, we expect major contribution. Next slide. Let's talk about the business environment, the projection, and the target. On slide 10, you can see the CDMO market itself, the size of the market. Temporarily, in 2023, bioventures suffered from slow growth in fund inflow, but over a medium to long term, the situation in the pharmaceuticals industry is for manufacturing, they are to rely more on CDMOs, including AGC. And therefore, CDMO business is certain to grow, almost certain to grow. On the right-hand side, you can see the annualized growth rate, CAGR, for each CDMO company. The investment and supply expansion, at least by 2030, the supply and demand will see more demand than supply. Especially, for the small molecule pharmaceuticals, stable growth is expected, and the purple portion and the orange portions are the biopharmaceuticals. We expect big growth in those areas. We expect this trend to continue. On the next slide, you can see our strengths. AGC's strength is threefold. Currently, we have 10 sites in three regions, Japan, the U.S., and Europe, providing high standard of CDMO services. We can respond to production, early phase, development to commercial phase, the whole process. We do have extensive manufacturing and inspection track records, including FDA and European authorities. And over the medium to long term, since AGC is a materials provider with digital and material informatics capabilities, we believe that we can differentiate ourselves from our competitors by combining those expertise over a medium to long term, which is described in more detail on this slide. We are doing the small molecule and biopharmaceuticals both, and we can respond flexibly from the early stage development to commercial production. And as for the strategies over a short term to medium term, basically we will further strengthen and expand the core CDMO business for small molecule pharmaceuticals and agrochemicals and biopharmaceuticals, and we will be responding to the modality change as well, which is shown on the next slide. The maturity phase, small molecule, growth phase ones, as well as mRNA. For those areas, we are making very aggressive investment. Sorry. We are taking the growth strategy to respond to that and the target, performance targets over a medium to long term. As mentioned earlier, in 2023, there was a temporary impact of the market situation, and because of the large CapEx, we saw a decline in operating margin, but over a medium to long term, we expect the recovery in the market. By 2026, we are to achieve the targets as you see on this slide. That concludes my presentation. Thank you, Murano-san. We'll now move into the Q&A session for Life Science business. If you have any questions, please click on the Q&A button and type in your questions. We'll first take the questions that we received in advance. First question is about the Boulder plant in the U.S. What is the current situation of that plant? Thank you for the question. Our Boulder plant. This is for biopharmaceutical CDMO. Large scale line was launched in 2023 in response to the order from a contract from a large customer. But there was technical requirements which were very high, and training facilities, we had issues with all of these factors. And based on the negotiation with our customer, we decided to delay, postpone the start by one year. But as mentioned earlier, the commercial production started this year, and there are many inspections to be made and other steps that we have to take. So we will be expanding the production volume going forward gradually, so we expect the major production going forward. Next is also about new lines in the United States. What is the contribution to the business performance by restarting the commercial operations of the new lines in the United States? Well, once again, this is about biopharmaceutical manufacturing line in the United States. We do not disclose profits and losses of different sites, but last year, mass production-based plans were laid out, but we did not have any mass production project. But this year, with the same level of expenses, the actual business started. That certainly will be a pure plus to our performance. Of course, depending on the customer's schedule, things can change, but toward the end of this year and early 2026, there will be a sizable contribution to the business performance. Thank you. Next question: the large stainless tank, SUS. You spent quite a bit of time in launching that. In the final analysis, what is the issue, and to what extent has the problem been addressed? And, if another new line of SUS is to be launched in the future, can we expect a more smooth launch? Thank you for the question. This is again about our Boulder site. 20,000-liter is the capacity of this tank. And, we acquired this line from a different buyer, and, we had to apply our improvements, and that facility improvement efforts took more time than expected. And, we have been granted major projects, and in implementing that, training of the operators took more time than we expected. Those were the issues. So for large, 20,000-liter or larger, tanks, this process in Boulder site is a real high specification project. Over the past one year, we have learned a lot, which could be leveraged going forward. So should there be another major contract awarded, I am confident that we can have a smooth launch. Next question is related to slide number eight. Thank you. Now, about the business environment, we received a question. On recovery is something that is mentioned about the business environment, and the first quarter was not expected to have a major recovery. Despite that, from Q1, what are the reasons for the downside? Thank you. This is also related to biopharmaceutical CDMO business. AGC's Life Science, especially as a bio CDMO, are largely biopharmaceutical startups. So in their early phase of business, we receive consignment. Now, the capital influx in that business was, became very difficult in 2020 and 2021. There was a recovery in 2022, but the recovery seems to have been a bit slower than we had expected. But in terms of the deals, the consignments, we are receiving more of the contracts. Therefore, in 2024 and onward, we expect a better environment of the market. Now, the first quarter performance was sluggish because of the Boulder plant ramp up. As of last year, we planned to have the restart of the operation earlier, but that was postponed. That plan slipped, causing this sluggish performance in first quarter. Thank you. Next question. For the global operation of biopharmaceutical and agrochemical CDMO business, do you have to have SUS stainless tanks? Would SUB alone be not enough, is the question. Thank you. Biopharmaceutical CDMO business is the topic here. You can see the strategy here. Our strength is that we have a single-use SUB. We were leading the industry in this business and our customers of the use of a single-use SUBs, should they succeed in development, then they would go into the mass production. And sometimes there is a possibility of being a blockbuster. So the customer would want AGC to respond to this supply even when the capacity increases. And therefore, on the part of AGC, in addition to the early phase development, we want to help the customers at large production phase as well. And a large SUS, of course, is better in terms of efficiency in other regions, and therefore, a large capacity is needed. Next question, about genetics related business of yours, and because of the decline in demand of bio startups, has it been affected, and what is your longer term perspective? Thank you. Well, first of all, the impact. Well, the bio startups are in their early stage of development, by definition. Therefore, genetics and cell therapy, all of these are being impacted. Therefore, AGC Group, having bio startups as customers, were largely affected. Now, in terms of genetic and cellular therapy, going forward, as this page indicate, at the top of the graph, the orange part is the genetic and cellular therapy. And at this point in time, the size is quite small. And as we look at the development of the pharmaceutical development overall in the world, this gene and cell therapies are sure to grow in the longer term. Therefore, AGC Group is already involved in a couple of very first application of gene and cell therapies, which counts only a couple of dozens at this point in time. Next question. The top line of this business, JPY 120 billion, was kept in 2023, higher than in 2021. Back in 2021, the scope of operation was smaller, and yet, if I remember correctly, the operating margin was over 20%. Whereas now, even with successful SUS, operating margin of 20% is not likely to be achieved. So what are the differences in terms of cost structure compared to 2021, and when can we expect you to return to 20%? Thank you for your question. I explained the market situation, especially the funding and financing of bio ventures who are our customers, and that is impacting our business as well. Getting back to the earlier question, while sales top line is not declining much, the operating margin is declining. Why? Over a medium to long term, we are expecting growth, and based on that, we are aggressively making investments. If you can look at slide 21 in appendix. Here you can see the global capacity increase on a global scale. You can see that capacity increase on full scale started in 2021, 2022, and the costs or expenses for that are becoming more specific this year and onward. So that's the difference in terms of the cost structure. Over a medium to long term, we are pretty certain about the contract order increase, but these new facilities will have to meet this growing demand while undergoing inspection, audit, and others. So in 2023, 2024, we are seeing this top-heavy expenses being recorded that is impacting our operating profit. But this 2025, 2026, with a direct business implication, that should translate directly into profit. Operating profit of 20%, when can we expect to get back to that? Maybe 2027 or thereabout is, we're hoping to achieve that level. Next question, about slide 22. Can we have slide 22? Well, it so seems on this slide, the proportion of commercial products are increasing. It may stabilize your profitability, but that could reduce the seeds of development. This only shows the proportion, but in terms of the volume, do you still have the sizable number of development contracts? Well, thank you for your question. This is a comparison with 2019, where the entire biopharmaceutical revenues have largely increased, so the early stage contract are, is increasing in number compared to 2019. Therefore, please consider that this entire pie has been bloated. Next question, slide 24. On slide 24, you are showing the changes in the manufacturing capacity. What about the overall utilization rate? Currently, I suppose that the utilization rate has declined due to the decline in demand. But in order to respond to the demand increase over a medium to long term, are you going to continue the expansion of capacity even in the difficult market situation? Thank you for your question. We do not disclose the details due to the customer relationship, but utilization rates, as you have correctly alluded, it's not very high. Earlier, I talked about the capacity expansion. Last year, this year, we are expanding our capacity. For the time being, the utilization rate would remain rather low, not high. But we are confident with the demand growth, and therefore, the utilization should go up, and with that, our profitability should improve as well. Next question is about cost structure. The first quarter, with revenues of JPY 31 billion, the deficit was JPY 6 billion. It seems like out of those numbers, the breakeven can be assumed to be around JPY 40 billion. Would that be the appropriate expectations? If that is correct, in the second, third, and fourth quarters, quarter on quarter, recovery of sales of 10% will finally get you to break-even point in fourth quarter. So the downside of first quarter was caused by a lower-than-expected demand, but how about the cost structure? Is it different from your original expectations? Thank you. The first quarter downside was also mentioned in the previous question. For one thing, the market recovery as well as orders that goes along with it has delayed. And also, the U.S. major biopharmaceutical deal has been postponed and slipped in schedule. As for the cost structure, I think I've already mentioned it, the large equipment ramp-up, not only in the United States, but in Denmark, in Copenhagen.... We will be launching the major plant there. Therefore, such investment will be accentuated in the cost structure for some time to come. As the market recovers, along with orders, which we are sure to happen, we will see improvement, and we will do whatever to respond to the changes in the market. Thank you. Next question, next question is on the need for structural reform. AGC has worked on the structural reform over the past several years in glass business and Display materials. Is there a possibility that similar, a fundamental profitability improvement measures will be implemented in Life Science as well? And if the answer is yes, what would be the measures that will be implemented? Based on the assumption that the business will grow over a medium to long term, consolidation of sites don't seem to be an option, so what can you do, is the question. Thank you for your question. For biopharmaceuticals, CDMO, as I've been saying, we are certain that over a medium to long term, the demand will grow, and not just for particular regions, but in Europe, the Americas, and, Japan. We are more confident that business will grow. So site consolidation is not what we are thinking right now. But of course, as the market situation changes, and dramatically, we need to take, measures as necessary. In the U.S., in response to the demand changes, we have revisited the operation, including the workforce revision, and, these should be implemented on a timely manner. We received one more question, so this is going to be the last question due to time constraints. The fund influx reductions impact continues, therefore, you have to look at how the things will turn going forward. But if the recovery is slower, do you think it is necessary to lay out some expenditures in order to put in place some structural reforms? What sort of the reform do you expect? In mid to long term, especially in this biopharmaceutical areas, as well as CDMO markets, we are very sure that these markets will continue to expand. Therefore, going forward, we will remain quite active in expanding our businesses. But of course, the market can be worse than what we had expected. In that case, we will have to put in place the necessary measures. For example, streamlining headcounts in some regions, depending on the business situations. But in mid to long term, modality in biopharmaceuticals, in the area of gene and cell therapies, new applications are sure to grow, and our business strategies must be able to respond quite quickly to such changes. Thank you very much. It is now time to conclude the Q&A session. Thank you, Murano-san. Thank you for your attention. Thank you very much for joining us today. With this, we conclude Day 2 of AGC IR Day 2024. When you close the Zoom screen, you will see the questionnaire sheet. It will take only about five minutes to fill out the form, so to improve our IR activities, your response is appreciated. If you have further questions, please contact us at this number in Japanese, or this email address that you see on the screen. Thank you very much for your attention.