Now the time has come to start the Hitachi, Ltd. web conference for institutional investors and financial analysts on fiscal year 2021 first quarter earnings. Thank you very much for participating despite your busy schedules today. Let me first of all talk about the materials for today's explanation. Please refer to the materials on the IR site of Hitachi, Ltd. and our news release site. I would now like to introduce the speakers to you. Yoshihiko Kawamura, Senior Vice President and Executive Officer, CFO. Tomomi Kato, General Manager, Financial Strategy Division. Masao Yoshikawa, Executive General Manager of the Investor Relations Division. The outline of the results will be presented by Mr. Kawamura. We will be switching over the screen. Mr. Kawamura, please. Hello, everyone. Thank you very much for the introduction. My name is Kawamura. Thank you very much for participating in this web conference despite your busy schedules. The pandemic is still running rampant. It is having a significant impact on healthcare services as well as our society. We appreciate the fact that we can still pursue our business in this environment. I would like to give you the outline result of Q1 first, and then the full year forecast will be presented later. Let me first of all talk about the two major themes underlying this presentation. DX, Digital Transformation, and GX, Green Transformation, are the major strategies pursued by our company. The major characteristic is that for DX, GlobalLogic, which is a Silicon Valley company of DX, deal has been completed now. They have joined us. As for green transformation, last year, exactly one year ago, ABB Power Grid business has been included into Hitachi, which is called HAPG. It is going to be changing its name to Hitachi Energy going forward. We have strengthened this business. With green, we will be able to provide this stable business in the DX and the GX. We now have the strategic tools to enable this process. Furthermore, I would like to mention that the pandemic recovery in Japan is somewhat delayed, but there are markets overseas that are already recovering. Namely North America, Europe, as well as China. In terms of the corporate strategy, we have allocated significant resources to the overseas market. This is being reflected in the performance. Overseas business is increasing, and increasing revenues as well. These are the two major factors that are driving the performance. Please refer to page three. Key messages are outlined here. First is the result remain firm, led by reforms of the business and cost structure. As a result, first quarter performance has been very strong. The first bullet point says that five sectors, Hitachi Astemo, and listed subsidiaries, Hitachi Construction Machinery, and also Metals, have increased revenues and profits year-on-year. We have outcomes of the reforms of low profit business and cost structure bearing fruit. I am going to be mentioning record highs on two occasions today. The first record high is in the IT segment. It has remained firm, posting record high adjusted operating income and ratio of 9.8%. This is the first record high that I would like to emphasize. The next record high is the overseas business. Building Systems business in China, railway system business in Europe, and industry business in North America expanded successfully, achieved a record high overseas revenues of JPY 1,459.8 billion, and overseas revenue ratio of 62%. This is also a record high. These record highs are the major characteristic of this performance. Second area is related to pandemic, but we are seeing solid order intake, mainly markets recovering from the COVID-19 pandemic. This is very important for us, that the business remains strong. As mentioned here in the bullet point, we have accumulated orders surpassing the year-on-year, mainly North America, Europe, and China supporting by market recovery. The next bullet point is HAPG, the driver of the green transformation. Steady order intakes have been recorded, and the trend of carbon neutral is driving this business. Q1 orders is JPY 2.7 billion, order backlog, approximately JPY 12 billion has been recorded. Transforming the business portfolio has been continuing. We have established a joint venture in the global home appliance business with Arçelik of Turkey. You might know about Arçelik. It is based in Istanbul. It is of the largest conglomerate, accounting for 10% of Turkey's GDP. Petrochemical, automobiles, IT. It is a major company group, corporate group. With this company, we have established a joint venture. This will allow us to accelerate these services going forward. Another important tool for the Digital Transformation is GlobalLogic. On the 13th of July, this deal has been closed. These are the major points in terms of the portfolio reform. Please refer to page four. I would like to talk about the Q1 results. Three graphs are shown. Left-hand side shows, the light gray is revenues, and dark gray is adjusted operating income. The curve in red shows the adjusted operating income ratio. From left to right is fiscal year 2019, 2020, and fiscal 2021 respectively. For fiscal 2021 first quarter compared to fiscal year 2019 and 2020, we have increase in revenues as well as earnings. JPY 2.3 trillion has been achieved, and JPY 130 billion for revenues and earnings have been achieved. For fiscal year 2020, was impacted by COVID-19. Even compared to fiscal year 2019, before the pandemic, we have exceeded in terms of performance. Right-hand side shows the five sectors, as well as the listed subsidiaries. Listed subsidiaries are Hitachi Construction Machinery and Hitachi Metals. We can compare against fiscal 2019, 2020, we have seen increase in revenues and earnings. If we look at the curve, 7.3% was the level for fiscal year 2020, but it has declined to 6.4% for this quarter because of HAPG. PPA amortization has had an impact to the tune of JPY 40 billion. That is the reason why it has declined. In the absence of this, 7.3% should be achievable. Below is the performance of the listed subsidiaries. You can see a V-shaped recovery. Last year for construction machinery as well as for metals, have been impacted by the market. Thereafter, it is on the course of recovery. Please refer to next page five. I'd like to talk about the strategic business of Lumada. Left-hand side bar graph shows the comparison of the Q1 on a year-on-year basis. You can see the increase. Red is the core business of Lumada. You can see the significant increase. Gray, JPY 140.10 billion has increased. It is increase of 38%. In terms of the fiscal year, it is likely to increase by 42%. Right-hand side, JPY 1.6 trillion is the fiscal year 2021 forecast. There is no change in terms of forecast. We will remain with this number in terms of fiscal year 2021 forecast. Right-hand side shows the composition of the segments. Left-hand side is the first quarter for fiscal 2021, and right-hand side is the forecast for the full year. It is a busy chart, but the outer ring shows the ratio between overseas and Japan. For the first quarter, 53% is Japan, 47% is overseas. The sector breakdown is also shown. IT is 33%. For the full year, Japan 55%, overseas 45%, IT will increase to 40%. Half of the Lumada business is overseas, is the major message here. Topics are shown here for the first quarter below. There are three to be shared in the area of IT. The Electricity Generating Authority of Thailand Demand Response demonstration project has been won. Inclusive of the renewable energy allocation optimization simulation can be done instantaneously using this. We will be providing system in this project. Industry. In this area, for [tenancy product, the IoT factory will be established for production order, as well the procurement will be optimized. This will also include the management of HR as well. A state-of-the-art IoT application will be used for the optimization of this water plant. Last, Hitachi High-Tech. In the upstream of semiconductors on the West Coast of the United States, a semiconductor engineering base will be established, close to our customers, to deal with the shortage of semiconductors. IoT will also be a driver here. These are the three topics to be shared in the area of Lumada business. Please refer to page seven. Once again, let me emphasize the results. The left-hand side shows the revenues. Comparing Q1 year-on-year basis, increase of 48% has been achieved in terms of revenues. For Q1, we have achieved JPY 2.4 trillion. Adjusted operating income increase in profit, and in terms of ratio, increased by 3.7%-5.5%. JPY 130.4 billion has been achieved in terms of Adjusted operating income. Right-hand side shows the specific items of profits. Overseas revenues, JPY 1.5 trillion, is a record high number. The Lumada business is JPY 303 billion. For the cash items below, for EBIT, as well as net income attributable to Hitachi and EBITDA and cash flows, you can see that YoY basis, it is negative year-on-year basis. This is because the Hitachi Chemicals had cash inflow and there is backlash that is reflected here. Page eight. The five sectors, Astemo and listed subsidiaries numbers are presented here. What is different this time is that in the past, Astemo was included in five sectors, and the other category was listed subsidiaries. From this time onward, we will have Astemo be independent, outside of the five sectors. This year, from January, we have established a joint venture with Honda. It isn't 100% a subsidiary of Hitachi, Ltd., therefore, we have separated Astemo. The classifications will be five sectors, Astemo and listed subsidiaries now. As mentioned here in the caption, five sectors has been driven by market recovery and acquisition of the Power Grids business, leading to an increase in revenues and profit. Astemo's business has increased revenues and profits because of the market recovery. Listed subsidiaries, last year was a very difficult year, but heading into this year for Hitachi Construction Machinery and Hitachi Metals have recorded an increase in revenues and profits due to market recovery. Adjusted operating income should be reported, that is JPY 98.2 billion for five sectors, JPY 12.1 billion for Astemo and listed subsidiaries JPY 20.1 billion. In total is JPY 130.4 billion. JPY 98.2 billion, or almost all of the total is generated by five sectors. Below that, adjusted operating income ratio is shown, 6.44% for the five sectors, Astemo 3.2%, listed subsidiaries 4.4%, total is 5.5%. Once again, you can see that the five sectors are the drivers of the profit. Page nine. Factors affecting changes in revenue and adjusted operating income is shown here. A wonderful chart. The tracking is made here. Revenues is at the top. The left-hand side, last quarter was JPY 1,594.2 billion. Now, on the right-hand side, acquisition of Power Grids business is JPY +264.6 billion. Hitachi Astemo joint venture with Honda has had a positive impact of JPY 265 billion of foreign exchange impact and others. The Hitachi Metals as well as Construction Machinery has recovered, therefore leading to JPY 2.367 trillion for this quarter. GlobalLogic is not included in the first quarter. Adjusted operating income, a similar trend can be seen here. Power Grid has been acquired, Hitachi Astemo foreign exchange and other impact, leading to JPY 130.4 billion for the first quarter. Page 10. This is showing the financial position in cash flows, the balance sheet as well as the cash flow. Left-hand side is as of March 31, 2021. Gray is as of June 30. It's only three months, therefore there is no significant change here. Over the full year, it will look different. What is characteristic for the first quarter is the interest-bearing debt. You can see JPY 2.531 trillion, that has increased by JPY 134.6 billion. This is because of the GlobalLogic acquisition. Funding was necessary, having an impact here. Below, cash conversion cycle should be referred to. You can see significant improvement to 68 days. That is improvement of 12.9 days. D/E ratio. Because of the funding of the GlobalLogic acquisition, currently it is at the level of 0.56 x. For our company, we are typically strong. It has been prevailing around 0.3x- 0.4x in the past. We would like to improve the D/E ratio to 0.3x or 0.4x. Operating cash flow will increase and asset disposition will be effective measures to improve the D/E ratio. We believe that the same time next year, there will be a significant improvement. Cash flow is shown here. Cash flow from operating activities, JPY 137 billion and free cash flow of JPY 130 billion. Next page is the revenues by market. I mentioned that overseas business is improving. Let's go clockwise, starting with North America, Europe and China, Japan, ASEAN, India, other areas are shown here. What is noteworthy here are the percentages in the circle. This is the increase in revenues year-on-year. If you look at North America, 197%, that is almost 2x. Europe, 207%, again, almost about 2x. China, 1.5 x. Japan is somewhat behind. It is growing, but it is limited to 1.1 x. ASEAN, India, 2x. Other areas, 2x. You can see that overseas markets are recovering significantly. In North America, Energy, Power Grids acquisition is having a significant impact. Similar for Europe, Power Grids is having a positive impact. Below, in India, ASEAN, Energy is having a positive impact. Hitachi Astemo is having impact as well in North America and China, where Astemo is having an impact. Astemo is also making contribution to Japan as well. Therefore, Energy and Astemo are the major drivers in increasing revenues. The ratio of overseas, this is now 62%. It used to be 57% or 58%. Therefore, in the past three months, a significant improvement of ratio has been achieved. This is because of the strategies that we have implemented. [Foreign language] Far were the results for Q1. The latter part, I would like to talk about the full-year forecast. Please turn to page 13. Here shows the forecast for a full year. Left-hand side is revenues and the middle, adjusted operating income. The left-hand side, revenues, year-on-year basis, this is up by 9%. The forecast for the full year is increase to JPY 9.5 trillion, and adjusted operating income increase of JPY 244 billion year-on-year. As you can see, it is increasing from 5.7% - 7.8%, to JPY 740 billion. The right-hand side shows the actual figures, starting from Lumada and also their cash items. I want you to note here that we have not changed the target. The figure in the parenthesis, compared to the previous forecast, everything is ± 0. There are no changes in the forecast. Also, ROIC, 8.3%, remains unchanged. The foreign exchange rate, we assume JPY 105 per US dollars. Next page 14. For the full year, as I have said earlier, the disclosure categories isfive 5 categories, Astemo and listed subsidiaries. For the full year, as you can see on caption, for five sectors, there is increase in revenue and profits and Astemo increase in revenue and profits, and listed subsidiaries also increase in revenues and profits. Recovery is seen. The figures I want you to note is the second line from the top, adjusted operating income. For five sectors, JPY 548 billion, Astemo JPY 97 billion, listed subsidiaries JPY 95 billion, in total, JPY 740 billion. JPY 740 billion and the five sectors, JPY 548 billion. When you see both of these, you can see there's about 75% of the total comes from the five sectors. Going down, adjusted operating income ratio for five sectors, 8.9%. Going to the right, Astemo 6.1%, listed subsidiaries 5.5%, in total, 7.8%. The 8.9% figure in the medium-term plan, we are targeting for 2021, 10% in our original plan. Because of impact of pandemic, there's a delay of one year. We are saying we are going to achieve in 2021. For the five sectors, I believe we will exceed 8.9% by the end of the year. It will get quite close to the 10% for the five sectors. Please turn to page 15. Just like for Q1, starting from left-hand side, full year to last year until this year. These are tracking chart. If you take a look at the revenues at the top, the Power Grid acquisition had effect increasing revenues and also Astemo. This is where the Power Grid comes to play as the JPY 90 billion. There's foreign exchange of a negative figure is that the overseas home appliance business, which is disposal. Going to the right, the total is JPY 9.5 trillion. Below is adjusted operating income. Power Grids is included, and then Hitachi Astemo and GlobalLogic. Going to the right, will go to JPY 740 billion. Page 16 is the bottom line net income. Starting from the left to right. JPY 740 billion is this fiscal year as of end of March figures. How this is going to go to the JPY 550 billion, first, by November, we believe there will be a TOB for Hitachi Metals. This is included in the schedule. This net gain will come here, and structural reform expenses. In the middle, EBIT, JPY 820 billion. Interest, income taxes, and others. Non-controlling interests. Going to the right, JPY 550 billion. Next are detailed figures by sector. For your information, we have prepared this information. Please turn to page 18. For IT, the left-hand side is revenue, middle, adjusted operating income, the right-hand side is EBIT. The left-hand side, for revenues, the left-hand side table compares Q1 of 2020 - 2021, the one on the right is a full-year comparison. Comparing Q1 and comparing full-year, there's increase in revenues. The content has shown the front business and services and platforms is a breakdown. In the middle is adjusted operating income. Similarly, the left-hand side compares Q1, right-hand side compares the full-year. For the full-year operating income, ROE to 12%, right-hand side, EBIT cash item for both shows an increasing trend. Page 19 is energy. Similarly, the left-hand side is revenues. In Q1 and full year, both shows increase, and operating income also is increasing, and the cash items is also increasing. For industry also, a similar trend is seen, and in particular here, I want you to note the adjusted operating income in the middle. Q1, 5.2%. For full year, we'll go back to 8.1%, so there will be a great recovery. EBIT cash items are also showing increase. Next page, mobility. There are increase in revenues and income. The right-hand side, for EBIT. For full year, there's a slight drop. The forecast is shown for 2021. The Agility Trains East stocks were sold last year, and there's a backlash for that, showing this decline. Next page 22, is Smart Life. Here, overseas business establishment joint venture, a home appliance business, and diagnostic imaging-related business, so it represents the revenues. There is a drop in revenues because of the divestiture of these two businesses. In the middle, adjusted operating income. As you can see, for a full year, there will be an increase to 9.7% or JPY 97 billion. Page 23, Hitachi Astemo. As I have been saying already, market is recovering, so there's increase in revenue and also increase in income in the middle, and also EBIT is going up. The other two subsidiaries, they are showing recovery. First, Hitachi Construction Machinery. If you look at operating income, we'll go back to JPY 61 billion, to a rate of 6.9%, and cash flow is also increasing. For Hitachi Metals, last year was negative. Compared to that, there is a great recovery. In the middle, adjusted operating income, JPY 24 billion or 4% recovery. As you can see below, there's no change from our previous forecast for page 24 and 25. Page 26 and 27 shows the figures by sector compared. In the middle, there is FY 2020, and the grayed portion of the forecast for 2021. It is good to compare these two. In case of IT, the second line from the top, adjusted operating income, JPY 269 billion in 2020, JPY 263 billion this year. 13.2% last year, this year, 12%. For IT, this includes amortization, GlobalLogic leading to these figures. For the rest, the figures show increase compared to previous year. The last one, page 27, under total revenues, is the figure I mentioned of JPY 9,500 billion, and operating income JPY 740 billion, and margin 7.8%. This is a forecast that we have. I have rushed through my presentation, but these are the results of Q1 and the forecast for the full year. Thank you very much. Thank you very much. We would now like to proceed to Q&A. If you wish to ask a question, please press the Raise Hand button on the web conference system screen. When your name is called, please unmute, state your name and affiliation, and ask your question. Should you no longer require to ask the question, please release the Raise Hand button. Please note that the video of the person asking the question will not be shown today. We will field questions from the Japanese channel first, and then proceed to the English channel. For above, we will take questions from the Japanese channel first. Please indicate by pressing the Raise Hand button. Please unmute and ask your question. Question: Thank you for this opportunity. I have two questions. First question is regarding Power Grids business. There's been a downward revision for the year. Please elaborate further. For the first quarter, related cost, JPY 23.2 billion is mentioned here in the presentation material. It seems that this number is very significant. Is it a one-off? Amortization, what is the breakdown? Please elaborate. For the downward revision for the full year, the adjusted operating income is where you had the downward revision. Why is this the case? Please elaborate. Related cost is being revised upward, inclusive of the first quarter. Why did you change the forecast for the full year? For energy, there are three sub-segments. That's JPY 30 billion. Does not add up. For other than the sub-segments, is there a change in plan? It seems that there is a deviation of JPY 5 billion. Please elaborate. That's the first question. Smart Life segment is where I'd like to ask the next question. [audio distortion] High-Tech is down in terms of revenues and earnings, the full year forecast is increasing profit, although decreasing revenues. The first quarter did not perform well, so there is concern for second quarter onward. How are you going to revert back to profitability? What is the likelihood? Please elaborate. That's all. Answer. Regarding Power Grid, I would like to ask Mr. Kato to respond. Regarding Power Grid, as you've rightly mentioned, page 19, the related cost is shown here. Let me give you the breakdown. For the first quarter, JPY 23.2 billion is shown here. PPA amortization, JPY 13.7 billion is included, and others is related cost of PMI and IT system structural reform expenses are included here. For full year basis, JPY 72.8 billion, out of which PPA is JPY 43.6 billion is included here. Apart from this, are similar to what I've mentioned earlier. PPA amortization is accounting for more than half. What about the JPY 5 billion? The JPY 5 billion is being investigated now. Let me talk about High-Tech first. Please refer to page 22. As you can see, operating income, the first quarter has declined. Last first quarter was subject to special circumstances last year, revenues were high. For this fiscal year, we have reverted back to cruising mode. That is how it should be interpreted. On a full year basis, as you can see on the right-hand side, the medical is very good and the front end of SPE is also making contributions as well. Overall, contribution is maintained. It isn't as if there is a peculiar risk to consider. Yoshikawa would like to talk about Smart Life. Let me give you further details. First quarter, the decline in revenues is related to medical equipment. It is remaining strong. Semiconductor Nano-T echnology Solutions is somewhat below, we are receiving good orders. There is no concern. Industrial solutions, on the other hand. This area, we are revising the transaction terms, we are also withdrawing from low profit business, forward revenues has declined. In terms of profit for the first quarter, as well as for the full year, the analytical solutions in nanotechnology, medical and semiconductor is planned to have a margin of 15% or more. Industrial solutions, we are revising the transaction conditions and withdrawing from low profit business. This will continue. The mix will differ. As a result, we will end up with lower revenues and higher profit. That's all. Regarding your question regarding energy, JPY 5 billion of Power Grid, we will confirm later and get back to you. Sorry that we can't respond now. A question. Power Grid, the adjusted operating income, there is a downward revision. Why is this the case? Kawamura-san, can you elaborate? Answer. The impact of COVID-19 is very significant in India and Indonesia. The plant utilization has declined significantly, which is being reflected in this number. Thank you. Thank you very much. I'd like to receive the next question. Please unmute yourself. Can you hear me? Question. In the first quarter and the second quarter, for the IT segment order situation, I have a question. Looking at the recent results, there's a strong investment mentality, but what is the order situation in your company about the IT orders? Answer. Mr. Kato will answer. About orders received for IT. Foreign exchange, well, based on some adjustments, 102% compared to the previous year, and in total is 116%, and against that is 102%. This is increasing steadily. Thank you. Question. In the second quarter, what are your forecasts for the second quarter? Do you think the increasing trend will continue? Answer. For the second quarter, I want to show you the results, not for our company, but what is the view of a market I would like to introduce. IT market in Japan, out of that, IT service business this year is the forecast made by the market forecast company, 3.3% is the forecast. Compared to that, we want to achieve a similar level of orders or a level higher than that. Question, my second question. In your first quarter operating income, compared to your company plan, what is the difference? Do you have a breakdown for that? Answer. With regards to the general overall situation in the first quarter, operating income compared to the budget has increased by about JPY 15 billion, and more than half of that is the influence of foreign exchange. Compared to the budget in first quarter, operating income has increased by JPY 15 billion. As for the breakdown, For your information, for revenues, has increased by JPY 130 billion. Out of that, the foreign exchange has an impact of about JPY 90 billion. Most of that is foreign exchange. Excluding that, is a slight increase of about JPY 40 billion. Almost all of that, in almost all segments, revenue has increased. As for income, as Mr. Kawamura mentioned, it's an increase of JPY 15 billion. Out of that, JPY 12 billion is foreign exchange. The majority of increase is foreign exchange. Compared to the plan, there was a slight drop for Power Grid. Because of the impact of the pandemic, there was a slight decline. In automobiles and Astemo, because of a shortage of semiconductors with the customers, there was a slight decline. For the rest, income has increased compared to the plan. That is all. Thank you. [Foreign language] Next question, please. Please unmute and ask your question. Question. I hope you can hear me. Yes. First of all, I have a request. Kawamura-san, in your presentation, in 30 minutes, you talked about the first quarter performance, but you did not talk about that in detail. That was my impression. For Hitachi, I understand that full-year forecast is very important, but numbers that have been disclosed as well as acquisition information was rather significant. I understand that there are many people present, but perhaps the change in the three months may not be significant, but I hope that you will spend more time on the first quarter results. I hope you can bear this in mind going forward. Based on that, I have three questions. First question was what Kato-san explained. It seems that demand is increasing, there is a problem in terms of supply-cut. Revenues go down and in terms of profit, JPY 12 billion. Compared to January-March, it seems that profit level has declined. In terms of revenues as well as profit, the changes, please elaborate further. Second question is regarding the mobility revenues. It seems that there is significant increase, profit did not increase in line with the increase in revenues. In terms of revenues, visible buildings as well as railways, there was increase in revenues. Why did you not increase marginal profits? Third question is regarding GlobalLogic acquisition. In the three months, there was a cash outflow. With GlobalLogic, there is going to be a debt as well as cash that will be brought into Hitachi. Please elaborate further in detail. Answer. First of all, regarding the first quarter explanation, it was not sufficient according to you? Yes, in terms of the number of slides, perhaps there was shortage. We will bear this in mind when we give you the second quarter results, and we will give you further details regarding the secondnd quarter performance. Thank you very much for the advice. Now, Kato-san, can you talk about Astemo? Yes. Regarding Astemo, in terms of plan, increase in profit overall, but for Astemo, because of the impact of the semiconductor, it is limited to the level shown here. If you refer to page 23, let me give you further details. Revenues has increased significantly compared to the previous year because we had three Honda subsidiaries integrated into us. 350% increase has been achieved, and JPY 180 billion out of JPY 382 billion is due to that. The remaining JPY 100 billion is the growth of the conventional external business on organic basis. Apart from China, there is a significant growth in all regions. In terms of the profit, the Honda subs have contributed. Other than that, there was also increase year-over-year. If you look into the quarter specifically, there has been impact of the semiconductor shortage. Regarding mobility, rather than elevators, the impact of the railway business. In the first quarter, Shinkansen-related business incurred increasing costs, having an impact here. Against the revenues, the profit increase was lower than expected. This is because of the Shinkansen, the bullet train, issue in the first quarter. Regarding GlobalLogic, the impact on BS will be explained. It was incorporated in July, it's only nine months that will have an impact. In terms of revenue, as I already mentioned, JPY 90 billion. Operating income, JPY 70 million. Margin, 20%. That is the business that has been incorporated. Impact on the balance sheet will be explained. Goodwill, JPY 650 billion. Others, intangibles, JPY 330 billion. A total of JPY 1 trillion or so. The other intangibles will be amortized by PPA. Will be amortized over 12 years. That's about JPY 30 billion amortization per year that is being expected. It's JPY 22.5 billion because it's only for nine months. Balance sheet and the goodwill's intangibles will be included. It will have a significant impact on Hitachi, Ltd., the balance sheet. That's all. Let's move on to Q on Q. Question Q on Q. Revenues is increased by JPY 30 billion or JPY 40 billion. Operating income, JPY 22 billion. It seems that the revenue has declined, more than that, our profit has declined. I think better profit could have been gained. What are the factors undermining this? Please elaborate further. Answer. As I have already mentioned, the India and Indonesia plants have been partially closed. This is having an impact. I talked about Power Grids, but this is the same for Astemo as well, impact of India and Indonesia. Impact of the semiconductor is being reflected in the numbers. Thank you. Thank you. I'd like to receive the next question. Question, I have three questions. I'm sorry to insist, but about automotive. You talked about impact of India and Indonesia, which we cannot forecast, and also semiconductors. Q1 was behind the plan, and for Q2 and towards the end of the year, how do you plan to recover? That is my first question. Number two, having said so, industry business seems to be doing well. 102% increase in terms of revenue for the full year increase, 30% increase for Q1. What is your forecast? Is that something that you must be cautious about in looking towards the situation going forward? Lastly, you talked about D/E ratio, 0.3, 0.4. You want to drop to that level by early next year? You made that comment earlier. Until then, improve the balance sheet will be done, after that, you will try to focus on increasing the return to the shareholders. Those are my three questions. Answer. First, about Astemo. Semiconductor has the largest impact. In the second quarter, I think the impact of semiconductors will continue. In the current plan for the third quarter, we are thinking of measures to be taking against the situation in terms of sourcing semiconductors, which will have impact from Q3 onwards. The reduction of the first quarter will be recovered by Q3 or Q4. The full-year budget remains unchanged. To be more specific, there are many types of semiconductors, and there are various types, very light switching-off semiconductors to high advanced semiconductors. From where are we going to procure? We are making very detailed plans. What resources cannot do cannot be replaced by somewhere else. We are thinking of measures, and then we will start to see effects on the third or fourth quarter. Supply will recover by then, so budget remains unchanged. About the industry, as we talk about the situation orders, currently, Q1 order situation, in total, I mentioned increase of 16%. In particular, for industry, situations are good as industry sector increase is 21%. Out of that, industry products is an increase of about 30%. Order is quite active and we can look forward about the situation going forward. About our D/E ratio and return to shareholders, as you have mentioned, it's not that sequential that we will provide returns to shareholders as D/E ratio recovers. That's not how we think. The funds are already prepared. What about the dividend? In general, we are thinking of general measures to be taken. About the dividends, last year, JPY 50 in the first half and JPY 55 in the second half. Now we are looking at the situation, and we think that would be around the level. If a buyback, we want to make the buyback more flexible. Including insider information, there is a lot of information going on. We are looking at the timing when the window will be open. It's not sequential. It's not going to take place in sequential manner. We look at the D/E ratio, and we're also considering the shareholders' return. We are looking at overall situation. About the semiconductor issue of Astemo, Yoshikawa-san will answer. I'd like to talk about Astemo. I am Yoshikawa from IR. On QonQ basis, it looks as if the situation is not good. Looking from a different perspective, on a year-on-year basis, what's the situation in Q1? We are trying to verify that. Actually, there was an integration. Up to Q3, it is a single AMS, and from Q4 onwards, it will be integrated. The Q1 information by Honda, when it was listed, was more than JPY 110 billion, and for Astemo itself was JPY 109.3 billion. In total, more than JPY 200 billion. When you compare, then on year-on-year basis, Q1 performance shows a growth of 73%. With Tier 1, compared to other Tier 1 in Japan, it's not bad compared to others. From Q4 towards Q1 this year, we must verify whether Astemo was the only case where a decline was shown. Performance of Q1, relatively speaking, compared to other Tier 1 suppliers, was there a big loss? No, we don't think so. Astemo, throughout the year, compared to the situation by this time last year, it is very difficult to make a comparison. I think we must look from this perspective. In terms of units for Q1, on global basis, is increasing by 50%, then revenue has increased by 73%. Relatively speaking, in terms of competitive advantage, it's not that we have only losers. Quarter- by- quarter, we have to verify the figures. Thank you. Thank you very much. [Foreign language] From the moderator, I'd like to provide the following information regarding global impact, regarding goodwill as well as intangible. JPY 600 billion and JPY 330 billion was mentioned. It is JPY 710 billion and JPY 390 billion for the goodwill and intangibles, respectively. The JPY 390 billion. We would now like to take questions from the English channel now. From the English channel, are there any questions? Please indicate by the Raise Hand button. Any questions? Any questions on the English channel? Please indicate if you wish to ask a question by the raise hand button on the screen. There seem not. We still have some time left, so we will go back to the Japanese channel for any further questions. Please indicate by the Raise Hand button. Just a moment please. There seems to be another hand up. Please unmute and ask your question. A question. Regarding the Power Grids business for domestic renewable energy-related business, government-wide effort is made for investment in this area. Is there any domestic business development that you can share? Or is there going to be a project emerging within this fiscal year will also be received in this area? What is the outlook going forward for the domestic business? Please elaborate. Answer. Thank you for your question. Specifically, we are engaged in discussions, and we cannot provide specific information yet. Generally speaking, regarding the Grids business, we have two basic technologies. HVDC technology is an area of strength, and the long-distance transmission is overwhelmingly strong business for Power Grids. When this is incorporated into Japan, the AC/ DC conversion as well as adjustment of the supply and demand balance can be overcome. We believe that projects can be won in this area. There is no project that has been decided yet, but these are the strong technologies of ABB that can be brought to bear in Japan as well. Renewable energy is hard to reduce, grid issues can be overcome, and the high utility costs can be reduced going forward. Thank you. [Foreign language] Regarding the question that we have received, energy sector, JPY 5 billion. That was a pending question. You asked a question about this. In this graph, it is not mentioned here, but for the sector overall, profitability improvement activities are underway. The accumulated effort is the JPY 5 billion that you referred to. The question, is it cost reduction? Yes, optimization of fixed cost is what we are implementing here. Regarding Japanese market, I would like to add the following information. After China and U.S., number four in the world, in Japan. Sub is HVDC switchgear, GIS, is one of the businesses, and we have the scale of number three in the world. However, in terms of the growth potential, it is low. For Africa and for Central Asia and Europe, the growth profile has not been established yet. For decarbonization to be realized, we hope that we can provide more products in the domestic market going forward. [Foreign language] Thank you very much. Now it is time, with this, we would like to conclude the web conference on the Q1 FY 2021 earnings. Thank you very much for your participation.