The time has come to start the Hitachi, Ltd. web Conference on the fiscal year 2020 earnings for institutional investors, financial analysts, and the media, as well as the progress on the 2021 midterm management plan. Thank you very much for attending the web conference despite your busy schedules. I would like to first of all share with you the schedule for today. It will be conducted in two parts. We will have the earnings presentation until 4:45P.M. After a break, from 5:00 P.M., we will have the presentation on the progress of the 2021 midterm management plan. For the materials for the presentation, please refer to the IR site of Hitachi, Ltd., as well as the news release site for your reference. Without further ado, we would like to start the earnings presentation. Let me introduce the speakers to you. Yoshihiko Kawamura, Senior Vice President and Executive Officer, CFO of Hitachi, Ltd.; Tomomi Kato, General Manager of the Financial Strategy Division. Masao Yoshikawa, the Executive General Manager of the Investor Relations Division. Regarding the outline presentation of the earnings, Mr. Kawamura will be making the presentation. We will be switching over the screen. I beg your indulgence. Mr. Kawamura, please. This is Kawamura. I am the CFO. Thank you very much for participating in this meeting despite your busy schedules. COVID-19 is still running rampant, but we have been able to pursue business, so I would like to take this opportunity to thank you for your support. I would like to talk about the results for 2020, as well as the outlook for fiscal year 2021. Please refer to page three. These are the key messages for fiscal year 2020. About this time last year, we were bracing ourselves for COVID-19 becoming serious. We had to increase cash flow. In terms of foreign exchange as well as the economic cycle, these are areas where we have ample experience, we have knowledge in this area. When we are beset with a pandemic and when there is external shock in the economy, the outlook is becoming uncertain. We wanted to secure liquidity, operating cash flow, therefore, became an important focus for us during the year. In that regard, cash flow has been emphasized in our business management over the year. Please refer to number one. Record high will be mentioned several times under number one and number two. Number one, we have achieved a record high net income on a consolidated basis. Numbers will be presented later. Furthermore, in terms of cash flow margin from operating activities, we have achieved 9.1%, which is also a record high. Against the difficult business environment, out of the five sectors, we have seen that IT segment continuing to drive our business. The IT segment achieved record -high profits. It was JPY 269 billion. The ratio was also the highest ever, as you can see here. Now, in terms of number three, at 13.2%. In terms of number three, the portfolio is making improvements with Hitachi ABB Power Grids, HAPG is what we're referring to. Mobility segment, elevator contributed very significantly in this segment. The three Honda companies have been included in Hitachi Astemo. Major projects are proceeding well for Hitachi ABB Power Grids. The carbon -neutral future business is making headway. We are receiving an increasing number of orders for Q4. A $2.3 billion intake was achieved. Order backlog was approximately $10 billion. Furthermore, in terms of railway system business, the Washington Metropolitan Area Transit Authority business was won, to the tune of JPY 239.8 billion, which is the contract that we have been able to achieve. In terms of the building systems, elevators were very strong, especially in China, making significant contributions. Number four, we have been rearranging the business portfolio. Hitachi Chemical, as well as the diagnostic imaging -related business, was divested. For FY 2021, we are poised to divest Hitachi Metals. Hitachi ABB Power Grids will be included, and Hitachi Astemo has been established. We are expecting the GlobalLogic acquisition to be completed in FY 2021. Therefore, we have transformed our business portfolio significantly. The third point is cost structure reform. I realized a cost reduction of over JPY 120 billion in FY 2020. Let me refer to the numbers on page four. This is the result for fiscal year 2020 as well as the focus for 2021. Please look at the left-hand side, the light gray, the revenues. The dark gray is adjusted operating income. The years are fiscal 2019, 2020, and 2021. From fiscal year 2019 to fiscal 2020, we have seen a reduction in revenues as well as profit, both revenues and adjusted operating income. From fiscal 2020 to 2021, we have increased revenues as well as operating income. Please refer to the graph showing the adjusted operating income ratio. We went from 7.5% down to 5.7%; 7.8% was reached. We will have a V-shaped recovery, making 2020 the bottom. Please refer to the right-hand side. Astemo has become independent from the five sectors for the purpose of disclosure. This is a joint venture with Sumeru, so it is easy to understand rather than including in the five sectors. With five sectors and Astemo, you can see that gray is revenues and dark gray is adjusted operating income. From fiscal 2020 - 2021, a V-shaped recovery is expected, going from 6.5% - 8.3% in terms of the adjusted operating income ratio. The target number is 8.3% for the coming one year. We will be making efforts to achieve this goal. For fiscal year 2021, our CEO, Mr. Higashihara, will be talking about the progress made in the Mid-term Management Plan. During this period, we are aiming to achieve 10%. Because of COVID-19, 2021 is expected to be around 8.3%, but in the following year, we will once again aim for 10%. That is how 8.3% should be evaluated below, showing the net income. Looking at fiscal 2020, that is JPY 501.6 trillion, which is the highest ever. For next year, we want to outperform this, aiming for JPY 550 billion. This will also be another record high if realized. Please refer to the next page. For the past one year, we have been focused on cash flow management. This has had a significant impact on our results. Please look at the upper part. We have rigorously implemented cash flow management. As a result, cost structure reform, reducing working capital, scaling capital expenditures rigorously, and promoting sales of assets were achieved so that the cash flow can be enhanced. Please refer to the right-hand side, especially the curve shown here. The ratio has gone from 6.4% - 9.1% in terms of cash flow margins. We are aiming for 7.9% next year. Below is the information regarding the cost structure reform. We are making progress in this area as well. Please refer to the right-hand side. In terms of SG&A ratio, you can see a decline. Fiscal 2020, gross margin has been declining significantly. Hitachi ABB Power Grids shared service exists in Europe, and we will try to capitalize on this and leverage this in the coming several years, for 2024. By 2025, a JPY 100 billion cost reduction is what we are aiming for. We will continue to make such efforts going forward. Please refer to page six. Lumada is a core business for Hitachi, as you can see on the left-hand side. For fiscal 2019, 2020, and fiscal 2021, numbers are presented. For fiscal 2019, it's a little bit above JPY 1 trillion, and then JPY 1.1 trillion for fiscal 2020. The focus for next year is JPY 1.5 trillion. The original plan that we have been sharing was JPY 1.6 trillion. Up to then, we were behind by JPY 200 billion. According to the evaluation we've made, we believe that 2021 is likely to be as planned. Specific topics are shown on the right-hand side. The first point is the GlobalLogic acquisition of the U.S. Obviously, this will have a significant contribution to the Lumada business going forward. Next is the establishment of the Lumada Innovation Hub Tokyo on the Yaesu side of the station. We will have a collaboration hub with our customers, and we hope that this will stimulate discussions on how Lumada can be utilized. Hitachi and Lumada will work together, and the smart digital substation project has been won. Using AI, for 1,000 stores of Workman Co., Ltd., we have started a co-creation for implementation at the customer site. Level 3, Honda Legend, will have an electronic control unit. Over the update, the system has been incorporated. This is autonomous driving Level 3. Level 4 is autonomous driving. Level 5 is complete autonomous driving. Compared to that, Level 3 means that under normal times, autonomous driving is enabled. This is how we have been able to achieve it. Specific topics are shown on page seven to transform the business portfolio for further growth. Is what we have been implementing for 2021. We are planning to sell Hitachi Metals. Proceeds are expected to be around JPY 114 billion. The environmental value is important, in addition to economic value, and we are making good results in this area as well. In terms of the environmental value, Hitachi ABB Power Grids has been awarded an additional order of the Dogger Bank HVDC. Direct current in the system has been won as additional business. We have also delivered an energy storage solution for the Singapore Virtual Power Plant. These are all environmentally friendly projects. A JPY 240 billion contract has been won in terms of Washington Metropolitan Area Transit Authority business. For social value in the healthcare business, as mentioned here, it started a collaboration with SOPHiA GENETICS. This is in the area of precision medicine or personalized medicine. With Axcelead, we will be pursuing the biopharmaceutical business that is in progress here. For social innovation businesses, establish principles guiding the ethical use of AI. The track record has been achieved so far. I have talked about the overall flow. From now on, I would like to give you the detailed results of fiscal 2020. Please refer to page nine. There are two graphs that are shown here. Left-hand side is the fourth quarter FY 2020 results, comparing with the previous year. The right-hand side is the FY 2020 for the full year basis. This is also comparing against the previous year. Information provided here for the full quarter for Hitachi Chemical divestment has been made. There has been impact of decreased revenues as well as earnings, but Astemo as well as Power Grid is making contribution as well for FY 2019. On a quarter-to-quarter basis, we have seen an increase in revenues. There is, however, a decrease in earnings. For FY 2020, as mentioned above, Power Grid, Hitachi Astemo has been integrated, having an impact of positive revenues. Hitachi Chemical has been divested, they will have a negative impact on operating income. In terms of 7.5%-5.7% is the ratio decline. However, we are poised to make a V-shaped recovery in 2021. Please refer to the right-hand side, the highlight of the numbers presented here. First of all, in terms of overseas revenues, detailed information will be provided later. It is accounting for now 52% of JPY 4.5 trillion. That's the amount of the overseas business. The amount of business is JPY 1.11 trillion. EBITDA, JPY 50.2 billion. On a year-on-year basis, an increase of JPY 666.6 billion. Net income attributable to Hitachi is a record high. EBITDA is the largest portion of the cash flow at JPY 1.342 trillion. Now, we have been tracking this from 2008. This is the highest ever for what we have tracked. Cash flow from operating activities is JPY 793.1 billion, and ROE equals 6.4%. For 2021, we are poised to recover to an 8% level. Year-end dividend, this will be decided at the AGM going forward. We are expecting to have a dividend of JPY 55 per share. That is an increase of JPY five on a year-on-year basis compared to the interim last year. Please refer to page 10. This is the result of the five sectors and the listed subsidiaries. Five sectors and listed subsidiaries, construction machinery as well as metals, are shown here. Vertically, we have the indicator of the revenues and others. Please look at the revenues. For five sectors, JPY 7.15 trillion. For listed subsidiaries, JPY 1.5 trillion. Total is JPY 8.7 trillion to JPY 9.1 trillion. On a year-on-year basis, 113% for the five sectors. Unfortunately for these subsidiaries, they were 64% impacted by COVID-19 as well as the unfavorable market. Adjusted operating income is shown below on a year-on-year basis, for five sectors as well as the listed subsidiaries. We have been negatively impacted. The adjusted operating income ratio is shown here, 6.5% for the five sectors and 1.7% for the listed subsidiaries. The total is 5.7% EBIT, or net income, rather, or JPY 19.1 billion. For the listed subsidiaries, JPY -17.5 billion. Total was JPY 51.6 billion. That's the number for net income. Please refer to page 11. This page is about revenue and adjusted operating income on the far left. The number for FY 2019 on the far right, FY 2020. You will see what's in between. In terms of revenues, revenue in FY 2019 was JPY 8,767 billion. As you look toward the right, JPY 600 billion is because of the divestiture of Hitachi Chemical. Hitachi ABB Power Grids: JPY 722 billion. With the consolidation of Honda's Astemo, JPY 191 billion. There's a foreign exchange adjustment and others, making the FY 2020 number JPY 8,729 billion, which is a decline. Adjusted operating income, the same process. JPY 661 billion is the number for FY 2019, and JPY 495 billion for FY 2020 is a decline in operating income. Please take a look at the next page. Net income attributable to Hitachi stockholders. You read the graph in the same manner from left to right. Adjusted operating income on the far left and net income on the far right, and you will see what's in between. There's reorganization profit, Hitachi Chemical and diagnostic imaging business, which was divested, railway business; and Agility in the U.K. The shares thereof were also sold, a total of JPY 452 billion. Because of special severance pay and so forth as part of structural reform expenses, JPY 128 billion, others JPY 31 billion, and JPY 850 billion are to its right. Tax expenses. Hitachi Chemical's taxes weigh heavy, JPY 325 billion. The net income on the far right stands at JPY 501 billion. Please take a look at page 13. Part of the balance sheet and cash flow is described. Top right, there's a balance sheet. Please take a look at the gray shaded part. As of March 31st, 2021, assets in total now are JPY 11,852 billion. Change from last fiscal year, on the far right, is JPY 1,922 billion. That's because of the acquisition of Hitachi ABB Power Grids. Typically, take a look at interest-bearing debt in the middle. As of the end of 2021, JPY 2.4 trillion, roughly. On the right-hand side, you can see that there's an increase by JPY 900 billion. Interest-bearing debt has increased. That's a big factor. At the very bottom, there's a debt-equity ratio. In FY 2019, it was 0.35 x, because of the borrowings, it has increased to 0.54x. When it's good, our D/E ratio has been 0.2x or so, 0.54x is a very high debt-to-equity ratio for us. With operating cash flow, we would like to bring it down to below 0.5x and further down to 0.4x or 0.3x in a year's time or so. Cash flow is stated at the bottom. Free cash flow as of FY 2020 was JPY 334 billion. Core free cash flow, JPY 419 billion. You can see the year-on-year number on the far right. We're focusing on cash flow, and the result is shown here. That was up to FY 2020. Let me give you a forecast for FY 2021. Please go to page 15. Here's the highlight in terms of the forecast. Revenue and adjusted operating income are given. YoY numbers show that we're going to increase revenue up 9%, and adjusted operating income, JPY +244.8 billion, is planned. Take a look at the graphs. Revenue planned is JPY 9.5 trillion. On the right, adjusted operating income targeted is JPY 740 billion. This is the officially announced number. The operating margin will be up from 5.7% - 7.8%. It's different from the five sectors, 8.3%, but overall, it's 7.8%. On the far right, as I said, Lumada is on plan. Revenue is expected to be JPY 1.5 trillion and EBIT, JPY 820 billion. We're going to have another record high next year. EBIT, JPY 1.37 trillion, or rather, JPY 1,370 billion. That's a record high as well. ROIC will come back to 8.3%. Forex rate, JPY 105 to the dollar. Please take a look at page 16. This separates five sectors from listed subsidiaries. From this year, Astemo is separated from five sectors. There are listed subsidiaries. Both the five sectors plus Astemo, as well as listed subsidiaries, will see an increase in both revenue and profit. Five sectors plus Astemo are going to enjoy a market recovery and acquisition of Power Grid, as well as Astemo, increasing in both revenue and profit. Listed subsidiaries will also, due to market recovery, see an increase in revenue and profit. Please take a look at the graph. For five sectors, JPY 7.77 trillion. Listed subsidiaries, JPY 1.73 trillion. Total, JPY 9.5 trillion. The percentage is, in total, 109%. You can see the YoY numbers to see that there's going to be an increase in revenue as well as profit. Adjusted operating income ratio, 8.3% for five sectors. Listed subsidiaries, 5.5%, 7.8%. At the very bottom, a net income attributable to Hitachi, JPY 529 billion JPY + 21 billion, comes to a total of JPY 550 billion. As I said, operating income is going to increase by JPY 740 billion as well. Moving on to the next page. You can see the evolution from FY 2020 - FY 2021. It's the same for revenue as well as adjusted operating income. There's a lifting from Power Grid as well as a lifting effect from Astemo. GlobalLogic is acquired. It will start to kick in from July. There's a Forex impact. Revenue will be JPY 9.5 trillion. The same with adjusted operating income. Please take a look at page 18. Here, net income attributable to Hitachi subsidiaries is given on the far right, JPY 740 billion. This is net income attributable to the parent, it will come down to net income on the far right. There is proceeds from the sale of Hitachi Metals, which will be incorporated, there will be expenses from structural reform and other adjustments. EBIT will be JPY 820 billion. Interest will worsen by JPY 20 billion, tax expenses will also weigh in. Net income will be JPY 550 billion. These are the main numbers in terms of the forecast for FY 2021. Starting from page 20, sector-wise numbers are given. Just to give you the highlights, page 20, the IT sector. In the middle, adjusted operating income. There are three bars. On the left is for FY 2019. In the middle, FY 2020. On the far right, FY 2021. Light gray portion of the bar is the service and platform. GlobalLogic is part of this, and the darker part of the bar is the frontline business, the front business. Adjusted operating income ratio will be down from 13.2% - 12.5%. Please take a look at the text. That's because of the disposal of intangibles from GlobalLogic. On page 21, energy sector. Please take a look at the middle bars, adjusted operating income, for FY 2019, 2020, and 2021. In FY 2020 and 2021, you can see the light gray portion is below zero. That's because of the acquisition of HAPG. Structural reform expenses had to be paid, and PPA amortization, and these are counted as negative numbers. Moving on to the next page, industry. In FY 2021, not just the manufacturing sector in Japan but also manufacturing sectors around the world are going to recover. Profit is expected to rise. Please take a look at the middle set of bars, adjusted operating income will rise from 5.5% in FY 2020 to 8.1% in FY 2021. Page 21, mobility. Again, in the middle, on adjusted operating income, profit margin will rise quite substantially to JPY 102 billion in FY 2021. This is greatly contributed to by the elevator business. Page 24, Smart Life Sector, again, adjusted operating income. You can see a light gray portion of the bar, which is Astemo. As I said, FY 2021 will be separated from the five sectors, on the right-hand side of the bars, you will no longer see that part. What will happen to Astemo's automotive business? On the next page, adjusted operating income in FY 2020. There was a problem with the supply of semiconductors, so it was down, but in FY 2021, it is expected to recover. Page 21, listed subsidiaries: Hitachi Construction Machinery. Again, take a look at the middle part of the page. You will see the margin in the circle. In FY 2020, the situation was very severe. Margin was 3.9%, but in FY 2021, it is to rise and recover to 6.9%. Page 27, Hitachi Metals. FY 2020 was unfortunate. There was a lot of depreciation and amortization, so a negative 0.7% margin. In FY 2021, profit margin is to recover to 4%, in positive territory. Page 28 onward, this is by segment. In FY 2019, 2020, and 2021, you will see the comparison. What I would like you to focus on is the IT sector. third line, adjusted operating income ratio YoY on the far right. With PPA amortization, 0.7 points down year-on-year. Energy's adjusted operating income ratio is 2.7% in FY 2021, which is 7% up year-over-year. Industry, 8.1%. Mobility, 8.2%. Smart Life, 9.7%. Automotive, 6.1%. Construction Machinery, 6.9%. Hitachi Metals, 4%. Other than IT, all the other sectors are expected to recover. IT alone, because of PPA amortization, the number is going to go down slightly. Take a look at page 30. This is revenue by region or market. Clockwise, top left, starting from North America, Europe by China, going down, and Japan. To its left, Asia and India, other areas, and other areas. This shows the growth rate year-on-year. North America, more or less flat. Europe is recovering by 10%. China is up by 20%, and Japan is very tough but down 8%. ASEAN and India as well, down by 5%, and other areas up 24%. Although not shown here, North America, Europe, and other areas, because we are incorporating HAPG, the contribution is quite substantial. Overseas revenue is JPY 4.574 trillion. It's 52%, and this will further rise, but now the ratio is 52%. Lastly, about disclosure on page 31. We have been working hard to improve our disclosure, and we're going to take a step forward. ROIC is going to be disclosed by sector, as you can see. As is described here, EBITDA will also be disclosed sector-wise. On the far left, IT, JPY 378 billion in EBITDA. This is the largest chunk of the cash flow. Starting from that, Energy. Power grids and conventional energy are separated out. Industry and industrial products are separated. Mobility, Building Systems versus Railway Systems. Smart Life is divided into two: Smart Life versus Measurement & Analytics. Then Astemo, Hitachi Construction, and other listed subsidiaries. The total comes to JPY 1,370 billion. I hope this will provide a reference for the analysts and others. That concludes my presentation. Thank you very much for your attention. I will be happy to answer your questions. Thank you. Thank you, Kawamura-san. We'd like to proceed to the Q&A. Those of you with questions, please utilize the question function on the Zoom screen, and indicate by the raise hand button. After raising your hand and being delegated, please state your name, and we will refer to the name on the system. When your question is no longer necessary, please lower your hand in the raise hand function. Video will not be presented today. We will take questions from the Japanese channel, the media first, and then the institutional investors, analysts, and then go to the English channel. At this time, we will open the floor for the media on the Japanese channel. Please indicate by the Raise Hand button if you wish to ask a question. Senbongi-san, please. Please unmute and ask your question. Question. I hope you can hear me. I have three questions. First question is regarding the presentation that you presented: Hitachi Metals is expected to be divested. What is going to happen to Hitachi Construction Machinery? A 6.9% recovery has been made in terms of operating profit margin compared to the past. There are challenges for them to become globally competitive. What is your take on that? The second is a more detailed question for ABB Shared Service. You are going to be consolidating functions there. JPY 100 billion cost reduction is expected. What functions are going to become common in what areas? Please elaborate further. Third question is regarding Lumada revenues, 42% for this year. That is a certain growth that is expected. GlobalLogic's contribution is likely as well. What is the contribution to be made by them? As a result, what is going to change in terms of the overseas ratio for Lumada sales? That's all in terms of my three questions. Thank you for your questions. For one and two, I'd like to respond, and for the Lumada question, I would like to ask Mr. Kato to respond. First of all, regarding Hitachi Metals, it has been decided what is going to happen to construction machinery. For 2021, a midterm management plan, we want to identify the direction going forward. This is unwavering. Nothing has been decided yet, but the best capital structure will be identified, and we are now investigating all the possibilities. There is no change in terms of our direction for construction machinery. The optimization of the business portfolio remains unwavering. In the last year of the midterm management plan period, we should be able to identify the direction for this entity. The shared service for ABB, we are thinking about three areas. In terms of procurement and purchasing, ESG purchasing will become increasingly important going forward. We believe that it is necessary to integrate because they have knowledge on the part of ABB. In terms of human resources as well as corporate affairs, this is also an area where we can integrate. Finance functions can also be integrated as well. In Tokyo, there are regulatory reportings, so not everything can be integrated, but we hope that we can maximize this possibility as well. For Lumada, Kato-san, please respond. Regarding Lumada, as Kawamura-san has mentioned, within the IT sector, GlobalLogic's impact will be JPY 90 billion in terms of revenues for nine months. That is assumed. For Lumada, basically, we believe this is going to be Lumada's core business. As shown on page six, in terms of the core business, it's going to increase by JPY 200 billion. About half of that is going to be accounted for by GlobalLogic, according to our assumptions. What about the overseas ratio? Yes. For FY 2020, we mentioned it's around 40% core, 30% related business, and 50%. For FY 2021, on the other hand, GlobalLogic will now be incorporated, and therefore overall, 50% will be our target. That's all. Regarding the question. Oh, I have an additional question for shared service. That means that for Tokyo's general affairs as well as finance and corporate affairs, it seems that the headcount will decline. Is that the case? Answer, yes, that is the likelihood. We have not yet identified the numbers, but when the work transfers, there should be a reduction in headcount. Thank you. Next, Hirakawa-san, please unmute and ask your questions. Thank you. Question. The question that I have is, when you acquired GlobalLogic, going forward, will the balance sheet increase by JPY 1 trillion because of the acquisition? In total, there's going to be a reduction of JPY 2 trillion, according to the CFO, Kawamura-san. With the Hitachi Metals divestiture, I believe the balance sheet will shrink. Moving forward, well, I'm not sure if it's going to happen in one year's time or two years' time, but how will you manage your balance sheet? What will the balance sheet look like? What's going to be your expectation or forecast? Well, thank you for the question. Answer, at the end of March, I made a statement, and that remains the same. This is part of our efforts to replace assets. At the end of FY 2020, the balance sheet, as was discussed earlier in terms of total assets, was JPY 11.8 trillion. We're going to replace assets inclusive of Hitachi Metals, which is divested. JPY 2 trillion of assets are divested. GlobalLogic is JPY 1 trillion, which will come in. On a net basis, a reduction by JPY 1 trillion. Total assets on the balance sheet will go down from JPY 11 trillion -JPY 10 trillion. It's the same as what I said at the end of March. How will it be managed going forward? As of today, as far as large acquisitions are concerned, we don't have any further plans set for that. Of course, operating cash flow will go up and debt will be repaid. The balance sheet will turn more solid. This is how it looks. Will the balance sheet swell in a major way? No, we're not expecting that to happen in the next few years. Thank you for the answer. There's another question I would like to ask about the acquisition of GlobalLogic. I believe this is a trend in the last few years, and this is relevant to other acquisitions. It seems that in an acquisition, goodwill tends to be very large. GlobalLogic has repeat customers. 90% or over of their business is from repeat customers. It runs a very stable business. Because of that, the acquisition price is going to be large, and that in itself could be a risk. With increased goodwill, how do you see the risk, and how are you going to hedge the risk? If you have any views you can share with us, please. Well, as you rightly pointed out, we've had large acquisitions, including HAPG and GlobalLogic this time. It's true that goodwill is increased. With PPA, we do automatically amortize goodwill as well as another part that is dealt with through the generation of cash flow. Goodwill that has the potential of impairment, we take a very close look at it. We conduct impairment tests every year, take a closer look to see if there are any uncertain factors included in goodwill. We are doing everything we can, and we manage balance sheet from a macro view. How much of impairment, if it happens, is going to be absorbed by our balance sheet or cash? We're looking at it from that perspective. What would be the maximum of absorption that we can make in terms of impairment? Also taking a macro view. From a both macro and micro view, we are dealing with this. Thank you. Next, we'll take questions from the institutional investors as well as analysts on the Japanese channel. Please raise your hand if you have any questions. Yasui-san, please. Please unmute and ask your question. Question. Thank you. I have three questions. First question is regarding IT services for fiscal 2021. The revenues and plan for profit are what I'd like to ask about. With GlobalLogic, inclusive thereof, it seems that revenues are not going up significantly according to the numbers you've presented. Recently, IT service investment is expected to increase. Looking at other companies, it seems that other companies are assuming growth in IT. In terms of the revenues for IT, it seems that you have a conservative forecast. Why are you taking a conservative approach? Second question, regarding ABB Power Grid for the fourth quarter. It seems that the revenue had an upside, but it seems that operating profit had been subject to a downside. It has declined. Why was there an upside in revenues but a downside in the profit? With climate change of increasing importance, Power Grid is an area that there is hope for growth in. You have talked about the orders received, but what is the current market environment in this area? Third question, regarding Astemo: the fourth quarter was very strong in terms of performance. According to the numbers I have, in terms of revenues, quarterly is around JPY 420 billion, and operating profit is JPY 35 billion. If you multiply this by four times, that's JPY 1.6 trillion and JPY 140 billion, respectively. That is the expectation from the outside. In terms of the internal plan. Are you saying that it is JPY 97 billion because of the conservative approach? Please elaborate further on these numbers. Answer. Regarding GlobalLogic, as well as IT revenues, will be responded to by Kato-san. Regarding ABB and Astemo, a response will be provided by me. Regarding IT for 2021, more than half are generated in the domestic market. The outlook for the domestic market is such that we are seeing signs of recovery from fiscal 2020, but it's still a gradual recovery. Fiscal 2021, in terms of the IT market, we believe it is going to be negative growth. It is likely to fully recover to the positive from fiscal 2022 onwards. DX orders are increasing in terms of revenues. However, overall, we believe that the numbers we presented are more likely. Regarding ABB, as you have rightly pointed out, for fiscal 2021, it was very strong. Fiscal 2020 was not only not for the full year, but fiscal 2021, in terms of revenues, was a little bit below JPY 1 trillion. That is the outlook currently. It's not a full year, it's only partial, but that's about a JPY 300 billion revenue increase. Growth is very strong. As I have already mentioned today, there is a structural reform cost that is increasing to the tune of JPY 10 billion. PPA will decrease going forward. The expenses will reach a certain level by adding, but with increased revenues, the profit margin should recover. For Astemo, you asked whether this is a conservative outlook. Actually, I'm chairman of this company, and recently we had a board meeting where we had discussions. That is one factor. In terms of semiconductors, there is a disruption that is taking place. In the first half, there was a shortage in supply. That was incorporated into the numbers for the first half. The outlook is very conservative. The semiconductor, if it recovers faster than expected, we could have an upside. That is our take. Currently, we are assuming that there will be a disruption in terms of the semiconductor supplies. Kato-san, please. Regarding Power Grid for 2020, in the fourth quarter, I think that's a question raised, as you have rightly mentioned. It looks like a lower profit for this area. This is an impact of the foreign exchange rather than the main business. In foreign exchange, we typically hedge. Hedge accounting will make sure that it's not processed in the P&L. There are many purchases in this business; therefore, it has not been processed that way. Foreign exchange impact is therefore reflected here. It looks worse because of the foreign exchange impact. Regarding Astemo, there is an additional comment by Yoshihiko-san. For this year's outlook, let me weigh in. In terms of market data, there is likely to be a semiconductor impact. Compared to peers, Denso, Continental, and the like, the operating profit and the street forecast are not to achieve 10%. 8% or below 8% is the prevailing view, and that is the reason why for Astemo we have a similar outlook. In terms of revenues, on the other hand, in terms of volumes, 10%-13% recovery is expected. In terms of profit, according to the street forecast, 9%-10%. In terms of volumes, revenues are the same and weak. For Astemo, last year 's numbers were only pro forma, but they're around JPY 1.4 trillion-JPY 1.5 trillion. That's a pro forma assumption to be made. Based on that, a revenue increase of 10% is not aggressive. It is in line with the overall market. That's what I wanted to add. Question. I have two additional questions. Regarding IT services, domestic is likely to be a negative market, according to your explanation. Specifically, do you have numbers to verify this? According to my take is that customer performance is likely to recover, I think investments is likely to increase. You have a negative outlook on this. I'm thinking that there must be a rationale why you have this outlook. Please elaborate further. Second, regarding Astemo assumptions, in terms of expenses in the fourth quarter, profit capacity utilization went up, and it seems that the fourth quarter was very strong. I want to know whether this is sustainable or not. Please elaborate. Regarding IT, Kato-san will respond. Regarding IT, as you see, numbers are what we are referring to, and I don't have the numbers with me, let me get back to you on that. Regarding Astemo, as you have rightly mentioned, in the fourth quarter, the numbers were subject to a significant upside. When we made the analysis of this upside, there were orders from the automobile manufacturers that we are seeing increasing. This is because in the first half of this year, the orders are being expedited and front-loaded, and that is having an impact as well. Going back to what I was referring to earlier, for the first half, we have a conservative outlook. We had a significant increase in the fourth quarter. Taking that into consideration, we have taken a conservative outlook for the first quarter and second quarter of FY 2021. What is likely to occur in Q1 and Q2 has been front-loaded into Q4 of last year. Thank you. Thank you. To continue, Yoshizumi-san. Yoshizumi from SMBC. I have three questions. This is a follow-up to an earlier question. IT, fourth quarter order intakes increase, as well as an increase in order backlog, if you can elaborate on that. An OP margin of 15% is quite high. Compared to the growth in revenue, growth in operating profit is higher, why such high profitability? If you could, please explain. Well, Kato will talk about IT. Yes. Fourth quarter for the IT sector. Order intake is affected by Forex and so forth. After adjustment, in the fourth quarter, 96% of last year's. For the full year, 95%. Order intake is robust, but only slightly. Order balance for IT is up to JPY 1.1 trillion. This is affected by COVID-19, but this is about the same as a year before. Thank you. If you could provide a background to OP margin improvement in the fourth quarter as well. With respect to the OP margin, the same with IT and others. The fourth quarter number in IT in terms of revenue was very large, and I think the same trend applies here. We conduct SI business in domestic margin and projects as well, and the risks expected did not manifest. In overseas last year, we performed a structural reform, reducing fixed costs that started a year before, and that impact was worn out, and that's why profitability came high. Well, a question. In the fourth quarter, orders are down 4%, for the full year, - 5%? Answer. Correct. My second point has to do with costs or expenses. Corporate elimination. There was an upside of JPY 47 billion from the plan in FY 2020. You have not spent all the expenses. JPY 47 billion is a quite large number, so why did this happen? Growth investment of JPY 26 billion, what was the actual, and in the new fiscal year, how much of that is going to be spent? Answer. You're talking about the IT sector all along. I would like to turn to Kato-san. Well, a question. I was asking about corporate overall. Kato will answer. Corporate elimination for FY 2020: there was an upside from what was announced in February. That was what the question was about. It's not that there was one single large factor. There were multiple factors that came into play to contribute to the upside. This is with respect to Hitachi's consolidated numbers, and there's brand revenue. Because of increased revenue, it went up. In the corporate sectors, expense reduction in travels and travel expenses went down more than expected. In the fourth quarter, investment projects were more rigorously selected, more so than the plan. Because of these factors, the number went up. For growth investment in FY 2020, increased by JPY 11 billion. Compared to the last announcement, it's down by JPY 15 billion. I said that we're being more selective in investment projects, and that is why. In FY 2021, we're not disclosing the number for this, but investments related to Lumada are to be increased according to our plan. Thank you. My last question, number three. Earlier, with respect to Power Grid, there was a Q4 impact in forex. For the fourth quarter, I think in terms of profit and loss, it went down. Is that because of the difference in forex? In the new fiscal year, you're going to have structural PPA JPY 80 billion. For the new year, down by JPY 30 billion. Is that going to be the case? If you could, please explain. Q4 for Power Grid, why did it go down? Impact from forex accounts for 50% of the change. I think it accounts for 60%-70% of the total difference, and that's the extent of the impact from the fluctuation of the forex rate. FY 2020 versus FY 2021, if you could, please look at page 21 in the slide deck. Power Grid. Power Grid was part of ABB. There was no consolidation system development PPA amortization. These are referred to as related expenses as described on page 21. As you asked, FY 2020, FY 2021, related expenses have not changed. PPA amortization in FY 2021, JPY 52 billion. In FY 2021, it's JPY 41 billion, so down by JPY 10 billion. These related costs, systems development costs, are part of that. Systems development cost is going to increase starting from FY 2021, and that's not much change from FY 2020 - FY 2021. Thank you. Next, we would like to take questions from the English channel. Those with questions, please use the Raise Hand button. Any questions on the English channel? There seem not. We will go back to the Japanese channel once again because we have some time. Anyone can ask questions on the Japanese channel. Any questions? There seem to be no further questions. With this, we would like to bring the earnings presentation for fiscal year 2020 to a close. We will take a break now and start the presentation on the premise of the 2021 mid-term management plan from 5:00P.M. Thank you.