Welcome to the Recruit Holdings Fiscal Year 2020 Earnings Conference Call. I am Shen from Investor Relations Department, and I will serve as the moderator. This call is a simultaneous translation of the original call in Japanese, and translation is provided for the convenience of investors only. Today, we have Hisayuki Idekoba, President and CEO, and Junichi Arai, Executive Officer of Corporate Planning Division. Idekoba will begin with the vision and the overall business strategies for Recruit Holdings. Jun will discuss the Fiscal Year 2020 results and fiscal year. In the inn owners to purchase computers and sign up for internet access, and steadily increased the number of inns in Japan that can be booked online. Similarly, in the beauty business, we also created an online reservation system that allowed beauty salons across Japan to take reservations online. This April, there will be no major changes in our strategy. We will continue to work on our mission, Opportunities for Life, which means connecting individuals and businesses faster, simpler, and closer than ever before. In pursuit of our mission, we are now outlining three specific pillars of our overall strategy: simplify hiring, help businesses work smarter, and prosper together. The first is simplify hiring. In other words, connecting people with jobs faster and easier. This is something we've been doing for more than 60 years since our founding, and I believe there is still so much more we can accomplish. The second pillar is help businesses work smarter. In other words, improving business performance and productivity through SaaS solutions. In the Japanese market, where the working population is expected to continue declining, we believe that simply making a true role in the lives of people all around the world. When the spread of COVID-19 began, millions of people lost their jobs and needed to find a new one as soon as possible, but they were not able to have in-person interviews. Since last year, we have accelerated the development of various online recruitment processes through SaaS solutions. Let me introduce an example that made me wish that cashless payment was more commonplace in the world. Long before, when my wife was working as a manager at a restaurant in Japan, I remember her saying that she had to go to the bank at least three times a week to make deposits and exchange money, and that it was such a waste of time. I thought that if the world becomes more cashless, people would be able to spring from the cold to keep them warm. This experience highlighted for me that many people are really in a difficult situation. Of course, it is important to support people in need through charitable activities. To solve the issue fundamentally, it is critical for people to have a job and earn a living, and I believe there are so many things that we can do. We have been making efforts to provide new opportunities and new jobs in parallel with prudent short-term decision-making while achieving solid results in the medium to long term. Even now, Recruit has a relatively small presence in the competitive global technology landscape. When I started running Indeed about 10 years ago, there were 30 to 40 engineers as a team at Indeed. For details of our Q4 financial performance, please refer to the earnings material disclosed earlier today. I will begin with the financial results for the last fiscal year ending March 2021. In the first half of FY 2020, HR Technology and Media & Solutions segments implemented rapid cost-cutting measures amid a sharp drop in revenue due to the rapid deterioration of the global market caused by the spread of COVID-19. In the second half of FY 2020, while revenue from HR Technology improved rapidly, in Media & Solutions, it was a six-month period with intense ups and downs with the positive impact of the Go To Campaign in Japan and the negative impact of the subsequent State of Emergency period. During this period, we continued to aggressively make investments that we believe are necessary for future growth in line with our management strategy. As a result, full-year revenue excluding the Housing Security Benefit decreased 8.7%, consolidated adjusted EBITDA increased 25.7%, and adjusted EPS decreased 31.8% year on year. Adjusted EBITDA for FY 2020 was JPY 241.6 billion, which was JPY 9.7 billion higher than the revised forecast of JPY 231.9 billion disclosed on February 15th. The full-year dividend will be JPY 20 per share, which is JPY 1.0 higher than our prior guidance. For the consolidated financial guidance for the fiscal year ending March 2022, the business environment continues to evolve rapidly as restrictions in some countries have variously been relaxed and reintroduced, making forecasting difficult. Assuming that new large-scale lockdowns and state of emergency will not cause long-term stagnation of economic activity, we disclose FY 2021 guidance in ranges today. Revenue and adjusted EBITDA are expected to increase in the HR Technology and Staffing segment, while revenue in the Media & Solutions segment is expected to increase compared to the previous year's revenue when excluding the rent assistance program. Adjusted EBITDA is expected to be JPY 270 billion to JPY 335 billion compared to the previous year. Adjusted EPS is expected to be JPY 95.51 to JPY 126.10. The dividend forecast for the half year and full year for FY 2021 has not been determined at this time. Next, I will talk about full year financial results and outlook by segment. For HR Technology, in the first half of FY 2020, revenue declined significantly in the first quarter due to the spread of COVID-19, followed by a recovery driven by the U.S., resulting in revenue reaching close to pre-pandemic levels during the second quarter. During the second half of FY 2020, hiring demand surged, particularly driven by small and medium-sized employers in the U.S., which created an imbalance between dampened job seeker activity in the U.S. and significant hiring demand, driving revenue growth higher. As a result, revenue for the full year decreased 0.4% year-on-year. On a US dollar basis, reported revenue was $3.99 billion, an increase of 2.2% year-on-year. HR Technology pulled back marketing investments and paused hiring during the first half of FY 2020 while prioritizing investments to simplify hiring, which put us in a strong position to support employers' hiring activities during the second half of FY. Investment, combined with the continued strong revenue performance expected in Q1, is expected to result in the highest quarterly adjusted EBITDA margin to date in the first quarter. Regarding the definition and classification of the HR market, please refer to our earnings release and question four in the FAQ. Next, for Media & Solutions. Revenue for the first half of FY 2020 dropped significantly due to the first state of emergency in Japan. For the second half, revenue in the third quarter showed signs of recovery, benefiting from the Go To Travel Campaign during the first half. During the second half, Media & Solutions made strategic and proactive marketing investments to seize future growth opportunities. In addition, an increase in costs related to the reorganization of the Media & Solutions SBU completed on April 1st, 2021. An increased allowance for doubtful accounts due to the pandemic resulted in a decrease of 41.6% in adjusted EBITDA. As a result, the adjusted EBITDA margin was 15.9%. For Media & Solutions, the guidance for Marketing Solutions for FY 2021, housing and real estate, and beauty are expected to continue stable performance, while the timing of revenue recovery in travel and dining is uncertain due to the negative impact of approximately 3% to an increase of approximately 9% year-on-year compared to FY 2020 revenue, excluding the rent assistance program, and is not expected to recover at the same level as FY 2019. For HR Solutions, although the uncertain business environment continues, mainly due to repeated states of emergency in Japan, from mid to late FY 2021, hiring demand from business clients, especially in the dining industry, which has been negatively impacted by the state of emergency in Japan during the first quarter, is expected to recover. The part-time job advertising business is expected to recover. The placement service is also expected to recover gradually. As a result, revenue for HR Solutions is expected to increase in the range of approximately 13%-24% year-on-year. For FY 2021, to realize our business strategy in the mid to long term that Idekoba explained, Media & Solutions is accelerating its investment for future growth in marketing and product development. As a result, we expect adjusted EBITDA margin to be approximately the same level as FY 2020. If the business environment deteriorates or if there's a prolonged delay in expected recovery, Media & Solutions expects to be able to control operating expenses as we did in the first half of FY 2020. As for one of our key strategies, help businesses work smarter, in other words, improving business performance and productivity through acceleration, adjusted EBITDA margin for Staffing in total is expected to be at the same level as FY 2020. Next, for capital allocation and shareholder returns. The capital allocation policy remains unchanged as shown on page two of the summary with the following priorities in this order: one, various investments, including development and advertising expenses in line with business strategies. Two, dividends. Three, M&A. four, share buybacks. In order to realize the world that Rikurūto is aiming for and to achieve our management strategies of simplifying hiring, help businesses work smarter, and prosper together, Recruit Holdings will strive and return profits to our shareholders by maintaining a sound financial position and continuously paying stable dividends while aiming to achieve a continuous increase in enterprise value. The amount of dividend for FY 2021 and beyond will be determined by comprehensively taking into account the trends of consolidated financial performance, including net income and financial conditions. We will consider whether or not to repurchase our own shares, taking into account the market environment and the outlook for our financial condition. We will continue to pay close attention to domestic and international trends and their impact, and aim to grow our business and achieve our business strategy from mid- to long-term perspective. We are grateful for our understanding and support of our shareholders, other capital market participants, and all of our stakeholders. Please refer to the earnings release for further. Citigroup Securities, please. Thank you very much for this opportunity. You had solid performance. I congratulate you. I have a question to Idekoba-san. HR Tech will support you against the competitors and decide to increase the market share? No, that's not what we are doing. Whether we are acquiring market share is not watched that closely. As I mentioned earlier, we want the users to find jobs very easily, and the employers can post jobs and hire someone very easily. We want to improve the convenience there in this type of business. When the business economy is bad once every eight or nine years, if we look back in history, what happened was, as an example, in good times when the economy is strong, companies decide to hire people. We have been shifting to technology-centered business. Given our current circumstances, in three years' time, our new innovation will progress this much or this kind of challenging endeavor will prove to be successful. You may have seen our past and seen how much resource we injected and how much increase we've seen. It's not like the past. It's difficult to forecast. I think this is the same for the HR matching market. You presented data on the market for HR Technology business, the drivers for the revenue. I would like to know your views on the drivers for the revenue. Currently, advertising revenue accounts for the largest portion, I understand. Will the situation continue to stagnate? The Hiring Platform that you launched in March, how are you going to localize it? What about Indeed Hiring? What is the direction? More in the long term, for the Staffing services, how you are going to make changes to that business. I'd like to ask your views and more detailed explanation on these matters. Thank you. Yes. Thank you. This is the first question. I'd like to first respond. Should I get to your second question at this time? Sure. The second question is about the SaaS solution for monetizing. What is going to be your focus on monetizing this business? You have 110,000 accounts, and it's less than 10%. You are, for the time being, going to focus on accounts. Looking at the current circumstances, I think it will take longer for the EBITDA to return to the pre-pandemic level. For the SaaS solution, looking at the growth drivers, what are they and what is going to be your focus for making this a viable business? Yes. Thank you for the wonderful, great questions. With respect to the first, HR matching and future drivers, what they're going to be, I understand that it was your first question. As I briefly touched upon earlier, of course, the hiring process needs to be much more simplified. Simply put, as I often say, is this. A company that makes autonomous driving cars, of course, there's a number of companies that are in that business. When we apply autonomous driving cars to the HR industry, what I'm trying to say is this, in autonomous driving, you have the taxi drivers, the jobs, truck drivers, and of course, there are people who drive their own cars. All those things happen even in autonomous driving. For job advertising market, it's exactly that, advertising market, looking at business clients' costs. Let's take Indeed, for example. We have about 10,000 employees. 300 to 400 of them, they are from the talent acquisition team. Their sole job is to work on hiring. Of course, advertising cost, it's something many companies pay, but 300 or 350 people, their contribution is actually great, and of course, the cost as well. If we outsource them, it would be the cost that we pay to a placement company. The underlying story is that the costs are basically incurred. Year 2020, many companies have downsized these hiring teams. Suddenly, with the end of COVID-19 pandemic in sight, companies may want to hire more people, but because they have already downsized their hiring teams, they need to hire people to be in the hiring team. That's what the situation many companies find right now. Now we have the Indeed Hiring Platform, 10,000, as you mentioned. In the U.S. and Europe, companies that provide payment platforms, comparing our revenue to theirs is that when we acquire one customer, how much increase in revenue it contributes. That is the biggest difference between them and us. One fourth, one fifth. Why is it less? Similar situation right now. How many more accounts we'll be able to acquire will be key. Looking at one condition for this to monetize, I would say is this the rate of cashless payments, percentage of cashless payment, if this reaches a significant level, then we will, of course, enter a phase where we need to consider how to monetize this. Having said that, again, first is Media & Solutions, especially in the Marketing Solutions. Under COVID, the dining and travel are now still struggling. Idekoba-san, after COVID ends, do you think this part will recover linearly, or do you think the value will change and the marketing media, Marketing Solutions will have to change? My second question is including HR tech. Going forward, Idekoba-san, your M&A strategy is what I would like to know. The budget size, JPY 700 billion was the capacity you had, and you used for the Australia strategy and JPY 200 billion, and the remaining JPY 500 billion was for HR and for marketing media, Marketing Solutions. What kind of capital allocations do you have compared to when you did IPO? Thank you very much for great questions. First question, dining and travel post-COVID, how they will recover post-COVID. Currently, we are running our business in many countries, and what we see now is, especially in the U.S., there is a strong rebound. I can call it a rebound. It is a significant economic surge. Many restaurants and hospitality hotels or airlines hiring, recruitment is now increasing. The hiring demand is increasing at a rapid speed. Hourly wage, companies have to raise at least $2 or $3 an hour to hire someone. In the past two or three decades, this is the most difficult period to hire someone. This is because, as you mentioned earlier, dining and travel. Are demand are recovering to pre-COVID-19 levels. That is why our business clients are trying to hire so rapidly. In the U.S., restaurants, I drove around and looked at how the restaurants are doing. There are many guests, many users in restaurants. There are a few chefs and few waiters, so the people have to wait a long time to be served. Looking at the situation, we had Brexit, and the COVID-19 damage was severe in the U.K., even in the U.K., the demand recovery is significant. Demand is rising at a great speed. In Japan, vaccination rollout, once it rises from 30% to 40%, 50% like U.S. and Europe, then we will start seeing the atmosphere we are now seeing in the U.S., I think. Fundamentally, human beings enjoy dining and travel, and especially travel. Travel had been increasing all along until now. People's value perceptions will not change with this one event, fundamentally. Now answering your second question, you asked me about my strategy on M&A. M&A, as I mentioned earlier, our mission is to help people find jobs, to make it easy for people to find jobs. This is our mission, which we have been committed to so far and will continue committing. We are looking for companies that are focusing on point solutions. I think there's a high possibility there. We are not thinking of the budget amount. We are rather focusing on trying to find the companies with good solutions so that together we can contribute to the society. That is my strategy. Thank you very much. From Mizuho Securities, Akitomo Kishimoto, please. This is Kishimoto from Mizuho Securities. Thank you for this opportunity. I have one question. For HR Technology, what are your views on the margin? In your explanation and also FAQ number 13, it also mentions it, but 20%, I think that's a rather high level. Is it going to be driven mainly by increase in revenue, or is it going to be improvement in the mix or new products and services? The assumptions for revenue for this fiscal year have been disclosed. What are some circumstances in which you are going to accelerate investments, and what are some circumstances in which you will hold investments? I'd like to understand more. One has larger revenues temporarily rather than the speed of cost input. When the revenue increase exceeds, it's possible that we have a higher margin. For medium to long term, the biggest cost item is, as I've been mentioning since before, what we can provide to society. Our biggest value is not sales and marketing, but actual products and services. That's where we bring value to society. In fact, we need engineering people who will make those products and services. We need to make sure that we hire these resources. That should be our priority policy. On this matter, as you are aware, tech stocks are surging, and over the past six months or so, there has been a very severe competition over resources, and also there's the effect of work from home. Engineers can now work from anywhere in the world. Companies are fighting over these resources. We will continue to make active investments in this area. As you said, revenue and to- CLSA Securities, Kato-san, this will be the last question. This is Kato from CLSA Securities. Thank you. I have a question on Indeed. In 2020, Idekoba-san, when you found this in 2010, what did you think was the most appealing point when you first found it? It is now a well-known company, but back then, barely no one knew it, and I'm sure there were oppositions of the M&A internally. What was the innovation that they had? Do we make this decision even if this person is having difficulty? That was the basis of thought. I remember them discussing from that perspective. Of course, there were things that were better and worse than my expectation. Back then, the engineering team is only 30 to 40 people in the engineering team. It was a pure startup. The first countries that do not have much data privacy gather data and do machine learning without individual consent. If companies do whatever they want in such countries, then it will be unfair. Depending on regions, the view on data will be different. Looking 10 to 20 years beyond, this may be a risk. I think