Now it's time to start the ORIX Corporation's financial results briefing for the six-month period ended September thirtieth, 2023. Thank you very much for joining us today. I'd like to act as a moderator. I am Nakane from IR Sustainability Promotion Division. Today, we have Mr. Makoto Inoue, the President and CEO, as well as Mr. Hitomaro Yano, in charge of Accounting and Treasury and Investor Relations. There are some housekeeping announcements. In order to prevent any interference, if you have any mobile phones or telecommunication devices nearby, please make sure to turn them off or move away from those devices. First, I will call upon Mr. Yano and then Mr. Inoue to make presentations and then take questions. We plan to spend about one hour. Now, Mr. Yano. Thank you for the introduction. This is Yano speaking, in charge of Accounting and Treasury and Investor Relations. Thank you for taking time out of your very busy schedule to participate in today's briefing. I'll start by explaining about our fiscal 2024 March results. Please turn to page two. For first half of fiscal 2024 March, ORIX reported net income of JPY 128.1 billion at 4.7% year-on-year. This translated into annualized ROE of 7.0%. Please turn to the next page. This is the breakdown of segment profits. First half segment profits were up 11% year-on-year. It was JPY 191 billion. This slide shows past trends of segment profits on a full year, quarterly, and half year basis from left to right. Base profits are dark blue and the investment gains are in light blue. At the far right of the trends, for the half-year basis, base profits were up 16% year-on-year to JPY 167.4 billion. This is primarily due to a recovery in the Real Estate and the concession business earnings thanks to higher inbound tourism and the higher profits of the Insurance segment as a result of higher investment income. Meanwhile, investment gains in light blue were down 14% year-on-year to JPY 23.6 billion. These were primarily due to investment gains on sale of multiple Real Estate properties booked in first half. Our CEO will discuss this later on. We plan to aggressively move forward with sales in the second half of this fiscal year. Please turn to pages 4 and 5 next. This gives a breakdown of segment profits and segment assets. This should give you a good overview of segment trends as a whole. Detailed information about each segment can be found from page 16 and beyond. Please review them in your own time, and I will just give you a brief overview using page 4 and 5. First is Corporate Financial Services and Maintenance Leasing. Segment profits rose 9% to JPY 40.3 billion. Corporate financial services, various fee businesses were performing well, and profits were up in the first half as M&A brokerage contributed to profits. In the auto business, used car prices remained high, and rental car demand is strong continuously, and rented profits were lower year-on-year, owing to the cost associated with the launching of new technology center, but this unit has posted steady profits. Moving on to Real Estate. Segment profit was up 42% to JPY 26.9 billion. In the investment and operations, profits were up year-on-year, thanks to improving earnings in the facility operation business, hotels and inns on a recovery in inbound tourism demand and office and rental condo sales were also booked. In the Daikyo Unit, profits were up sharply year-on-year on strong condo sales. In Real Estate assets, in Real Estate, assets were up 69.4 billion yen versus the end of last year, as a careful selection of our new assets continued alongside asset sales. Next is PE and Concession. Segment profits were up 141% year-on-year to JPY 9.7 billion. In the PE Investment Unit, segment profits were up year-on-year as profit contributions from DHC and Hexel Works, which were acquired last year, offset lower profits from other investments and impact of investee sales last year. The Concession Unit returned to the black for the first time on a quarterly basis since the start of the pandemic on the recovery of international passenger numbers, and there's a three-month delay in this profit reflection. The segment assets were up JPY 203.3 billion versus end of fiscal 2023 March, which with the execution of Toshiba LP and the mezzanine loan. Next is Environment and Energy. Segment profits were down 10% year-on-year to JPY 8.1 billion. In the domestic energy business, segment profits were up slightly year-on-year, thanks to a large number of sunny days in the second quarter, which offset the impact of output curtailment in the Q1. In the overseas energy- Overall profits were down year-on-year due to higher hedging costs on foreign currency denominated assets caused by higher interest rates. Profit contributions from Elawan were higher, and the Green ko profits were also up year-on-year. Segment assets were up JPY 59.6 billion year-to-date, owing to Forex changes. Next is Insurance segment. The segment profits were up 151% to JPY 37 billion. Segment profits rose on an increase in investment income, thanks to the weaker yen and higher interest rate, as well as lower COVID related payouts. Segment assets were up JPY 53.3 billion on Forex changes. Next is Banking and Credit. Segment assets profits were up 8% to JPY 16.5 billion. The banking business unit has seen the financial revenues grow as a result of higher interest rates, lifting the long-term prime rate. They also benefited from the growth in fee revenues on an increase in trust assets. ORIX Bank continues to strengthen its profitability through growth in the trust and other businesses, and not by unnecessarily increasing assets. As a result, banking segment assets were flat versus a year ago. In credit business, both assets and segment profits are mostly flat year-on-year. Next is Aircraft and Ships. Segment profits were JPY 10.4 billion, down 2% year-on-year. In the Ship Business Unit, profits were down year-on-year on absence of year earlier gains on timely sale of owned vessels during the period of high prices. This was in line with our initial targets. Four ships were sold during the first half. Aircraft leasing posted higher profits amidst the recovery in passenger demand. Leasing revenues rose thanks to higher lease rates and increase in the number of owned aircraft. Avolon, turned profitable on a quarterly basis after accounting for hedging costs, thanks to a rebound in passenger demand. Segment assets were up JPY 164.3 billion on Forex effects and an increase in owned aircraft. Next is ORIX USA. Segment profits were down 24% to JPY 16.3 billion. There were fewer exits in the PE business, owing to changes in the macroeconomic climate, which was the primary reason for lower profits in the segment. Segment assets were up JPY 63.4 billion in OCU. Local currency denominated assets are lower, as ongoing enhanced risk management has led to OCU to rein in new investments, but charges, changes in the Forex led to higher yen-denominated assets. Next is ORIX Europe. Segment assets were down 19% to JPY 13.4 billion. Profits are lower, owing to hedging costs on Forex-denominated investments, primarily at Robeco Group, caused by higher euro interest rate. However, AUM on a recovery trend with the launch of active ETFs and fee income is stable. Segment assets were up JPY 35.1 billion year-to-date, mainly due to Forex changes. Segment profits are down 49% year-on-year to JPY 12.4 billion. This is finally the Asia and Australia. Profits fell due to the absence of gain on sale in the Southeast Asian affiliate in the same period of the previous year, and lower profit contributions from investees. Despite this, leasing and loan operations were healthy in Asian countries. Segment assets were up JPY 174.8 billion year-to-date, owing to Forex changes and due to favorable new lease executions in various countries. I'd like to also make some comments on the impact of rising yen interest rates. Yesterday, BOJ announced the new policy, and they have made upward revision to the long-term interest rate. For ORIX, especially for the financial businesses, the higher interest rate in yen will be the positive. ORIX Bank holds variable interest rate assets, especially those linked to the long-term prime rate, of close to JPY 1 trillion. A rise in the yield curve during the period of higher interest rates, therefore, will have a positive impact. In Insurance, asset rotation in our investment portfolio leads to higher yields during the times of rising interest rates. Also, more than anything, the reduced present value of the insurance liabilities outweighs decline in asset value, which will benefit embedded value. This is also bolster future earnings. In the domestic corporate financial services business, we have held off on aggressively pursuing additional financial finance leasing business because of low interest rates and excess liquidity. However, higher interest rates could be an opportunity for this business to grow. So that was about the rising yen interest rate. And with that, I'd like to end my presentation and the microphone to Mr. Inoue, our CEO. All right. Yes, this is Inoue. ORIX, I would like to start with page six. Fiscal 2024 March first half, pre-tax profit came in at JPY 184.5 billion. Net income was JPY 128.1 billion, just to repeat. This was a slight increase of 4.73% year-on-year, and it represents a 38.82% progress towards our full year outlook of JPY 330 billion. Interim dividend was JPY 42.8 per share. Continuing, we will continue to execute the share buyback for this fiscal year. Please turn to page 7. For the first half, we had a net income of JPY 128.1 billion, which is a 38.82% towards the JPY 330 billion outlook for the full year. The reason, first of all, is investment gains from asset sales is likely to be back-end loaded. In other words, it's going to be a second-half heavy earnings plan. And secondly, the uncertain outlook in the U.S. interest rates, we are seeing higher credit costs, and we have decided to rein in new private credit origination at ORIX USA. And thirdly, hedging costs increase due to higher U.S. dollar and euro interest rates. With the ongoing Russia-Ukraine conflict and intensifying of fighting between Israel and Hamas, the global situation is becoming more challenging. In addition, rising energy costs, interest rate trends in major currencies, and the price inflation globally makes it increasingly difficult for us to make accurate forecasts. Within Japan, higher prices, labor shortages, and a weakening yen have lowered visibility, but an inflow of capital from outside from Japan has continued to provide support. Our domestic business are healthy overall, with base profits up 16.1% year-on-year, centered on Real Estate, PE and Concession, and Insurance businesses. So we are performing ahead of plan. Please turn to page 8. Having said all that, in order to meet our full year targets of net income of JPY 330 billion and ROE of 9%, we will need to achieve growth in base profits and realize the sales of some assets in the second half of the fiscal year. In the first half, we booked investment gains of JPY 23.6 billion, and we forecast that investment gains will be concentrated in the second half of the fiscal year. So we will expect a sharp recovery in the second half. Assets up for sale are primarily logistics facilities, rental condominiums, and other Real Estate related assets, as well as our private equity assets and renewable energy facilities. Negotiations on conditions are currently underway with potential buyers, and we will release details as soon as they become available. To give you an overview of the first half results, domestic businesses were strong overall. Real Estate, PE and Concession, Insurance, and lease financing business and corporate financial services posted pre-tax profit of JPY 138.2 billion, up 142% year-on-year. We expect to book investment gains during the second half, so we believe that we will have steady earnings if everything goes according to plan. Page 9 and 10. Airport concession and Real Estate operations have enjoyed a particularly strong recovery. During the pandemic, concession recorded around JPY 10 billion in losses because of the ownership stakes. However, we focused about the JPY 5 billion in pre-tax profit contribution in the latter half of this fiscal 2024 March, and I expect a return up to around the JPY 10 billion in profits in fiscal 2025 March. In Real Estate operations, the average daily rate and the lodging facilities have already surpassed pre-pandemic levels, and increase in inbound tourism leads us to believe that additional improvements can be expected. As for Osaka IR, we have signed an agreement with Osaka City and Prefecture late September. Although the investment amount is higher than we had initially planned, owing to inflation and rising concession costs, construction costs, we judged that the project still allows MGM and ORIX partnership to secure desired level of profitability. So we are finalizing details with general contractors. We are preparing to begin construction in 2035, following the solution of land subsidence issues. The primary reason for 38.82% progress has been poor performance at ORIX USA, despite the weak yen. The extent to which we can recover from that is going to be one of the challenges for the second half. In the U.S., high interest rate persists, which means that we accelerated sales of existing assets, approximately $750 million worth. We also limited new deals, but unfortunately, credit costs- And allowance for doubtful accounts increasing. So for fiscal 2024 March, we are strengthening credit risks, monitoring, and prioritizing risk controls, and we anticipate that ORIX USA will underperform the initial profit target by about $200 million. In other words, whether other segments can offset that is going to be the challenge for the fiscal 2024 March earnings outlook. Robeco Group, AUM declined during the first half, but it has hit bottom and is on a recovery track. We expect roughly 10% year-on-year decline in fee income for fiscal 2024 March. However, new funds such as ESG funds and active ETFs are launching, and the outlook of the business remains bright. ORIX Europe, overall AUM is EUR 301 billion, and the segment profit pre-tax income was EUR 125 million for the first six months. AUM for Robeco parent is EUR 166 billion, and we will continue to improve earnings in this segment. In Aircraft and Ships, passenger numbers in the United States and Europe remain at the record high levels, and airline demand for the leased aircraft is strong. We thus expect to accelerate the number of purchases and aircraft sales in the second half. While it could take some time for earnings to recover, owing to the higher euro and US dollar hedging costs, we expect an acceleration in asset sales to allow for improvement in ROE, ROA, and additional earnings contributions. In page eleven. In 2017, we purchased 10,988,577 shares in the renewable energy developer and operator, Ormat Technologies, for $626 million. In November 2022, we sold 7.69% of this stake and booked $113 million or JPY 15.9 billion gain on sale. We continue to hold 11.08% of the stock, and the current share price is around $62 per share in comparison to the purchase price of $57. Although the shares are down, owing to the Israel-Hamas conflict and other factors, the shares remain at acceptable level, even after considering for hedging costs, but we plan to take a wait and see stance. At the time of purchase, Ormat's adjusted EBITDA was $344 million, and the company's guidance for the earnings is between $480 million-$510 million for this fiscal year. Operating capacity have increased from 700 megawatts at the time of acquisition to 1.2 gigawatts, and by 2025, the capacity is slated to increase to between 1.9 gigawatts-2.0 gigawatts. We view this as an exciting future investment portfolio. For the overseas renewable energy business, Elawan has a portfolio of 1.65 gigawatts in operating assets and generates earnings contributions of more than $90 million, EUR 90 million annually on a total asset of EUR 2.67 billion. The firm has roughly 8 gigawatts of capacity, either under construction or in development, and we are moving ahead with plans to sell certain assets, chiefly those with stable cash flows. Elawan, its earnings flow into ORIX Group is six-month lag, and some asset sale may be posted during the next fiscal year. However, we expect to be able to achieve a ROA of 3% or higher for this business. Elawan's assets in operation have more than doubled in 2 years since it joined ORIX Group. This and its rich pipeline make us believe that the firm has a portfolio ripe for capital recycling in the future. We plan to develop Elawan into a core part of ORIX core portfolio. In 2021, ORIX acquired 20% of outstanding shares of Greenko and has now invested a cumulative $978 million. We own a total of 6.3 gigawatts in solar, wind, and hydroelectric assets in operation and has three large-scale pumped storage projects equivalent to 4.6 gigawatts under construction. We have a total of development pipeline of 12 gigawatts, including new pumped storage projects. In pumped storage project construction, steady progress is being made in concluding offtake contracts, and Greenko plans to begin operating some of the projects from June 2024. We strongly believe that the investment value of the Greenko has increased substantially. Page 12. At DHC, which we acquired last year, we have implemented a new management structure. We are improving governance and compliance, IT strategy, product strategy, and are rebuilding marketing efforts and executing the...... Post-merger integration or PMI, such as reviewing business in Greater China. Preparation to take Toshiba private is underway. Following the November 22 extraordinary shareholder meeting, the company is set to be delisted on December 20. We executed LP equity investment and mezzanine loan of JPY 100 billion each, and expect earnings contribution from next year and onwards. The timing of when gains on the sale of assets are booked will be an impact on whether or not we achieve the FY 2024 March earnings outlook for JPY 330 billion in net income. Depending on the progress made in the individual deals, there is a possibility that we may have to revise our targets. Nonetheless, we will continue to do our most to meet our earnings forecast. Finally, ORIX Group has revised our corporate philosophy, and I'd like to announce the new ORIX Group purpose and culture. The English translation of the purpose and culture is: finding a path and making impact. So this is our purpose. Our purpose defines our ORIX Group's, why ORIX Group exists in the world, and our culture is a set of shared value. In order to bring this purpose to life, I would like to support its widespread acceptance as a shared way of thinking among ORIX Group people globally. I hope that ORIX Group can unify around the ORIX Group purpose and culture as we seek to bring new values to all our stakeholders worldwide. Thank you very much for your attention. Now, we would like to open the floor for questions. If you have a question, please press asterisk and one. When your name is called out, please ask your question. If you wish to cancel your question, please press asterisk and two. We would like to ask you to keep the number of questions to one. SMBC Nikko Securities, Muraki-san, please ask your question. Yes, this is Muraki, SMBC Nikko Securities. I have some questions about what will happen when the interest rate goes up. First of all, sensitivity to yen interest rate. Mr. Yano has already explained about what happens when the long-term interest rate goes up. But excuse me, I'm sorry to interrupt, but could you wait for a moment? We have a technical problem. My apologies. I could not hear what you were saying. Could you please start from the beginning? Yes, this is Muraki, SMBC Nikko Securities. I want to know more details about what happens when the interest rate goes up. If a short-term interest is about five basis point, like it was in 2007, and the long-term interest rate is about 1.5%, let's say, under that scenario, what kind of business opportunities will ORIX see? In the integrated report, I saw that there was a story about when you joined Mr. Inoue, and lease profit and funding. There used to be margin arbitrage, but right now it is not possible. But if the short-term interest rate is about 50 basis point, maybe arbitrage would be possible again in the corporate financial services business. So I want to know if that's possible, so that's the business aspect. And also, with regard to ORIX Bank and ORIX Life, considering the potential IPO, as a CEO, what level of profit or gain on sales would be- you'd be satisfied with? Or can you expect that if you look at Rakuten Bank's PR and PBR, for example, it is growing high, and its PBR is about 2x right now. So for ORIX Life and ORIX Bank, I understand that you will not be holding these entities forever. And once the financial policy normalizes, maybe it becomes unrealistic to sell off these assets. That's my question. Thank you. First of all, impact of a higher interest rate. Well, of course, the bank, life, and the lease, we can expect arbitrage as the spread widens, so this is a favorable situation for us. So centering around corporate financial services, lease operations, which used to slow down in the past, can now accelerate. But with dozens of basis points, the spread would not widen that much. So interest rate will have to reach maybe 3%, 2%, 3%, 4% before we can do an interesting, spread business, arbitrage business. Life and bank, well, the assets that we hold are different from lease. They are more liquid, which means that, including potential sales of assets, maybe we can expect improvement in the earnings. Now, bank and life, well, zero interest rate continued for a long time, and the PBR in the financial sector was 0.05 or something like that. So we can expect improvement in the share prices due to higher interest rate. And once that happens, of course, we will start a dialogue with the market. Rakuten Bank, yes, we do look at those things as well. And Rakuten Bank, PBR goes up that much. Why not ORIX Bank? That's the question that we received. Now, a Real Estate, condo investment and also trust business and merchant banking, we start, and the various activities are starting, but we don't want to suggest one single thing. The business model has to be multiple, not just one. Otherwise, overall PBR will not go up. So either way, in order to prove the earnings from the banking business, we need to increase the number of businesses that are multifaceted, and this is something that I'm talking with the bank team. As for life insurance, of course, the higher interest rate will directly impact that business. So embedded value and the other improvements could be expected. So depending on the situation, in the future, life insurance liquidation, or excuse me, life insurance sell-off may be possible, but we don't have enough materials to decide that right now. Now, in terms of negative impact, private equity, of course, and also Real Estate development projects, would experience high interest rate and also higher construction cost. High interest rate will push up general costs. So for development and exit NOI, we have to carefully look at the arbitrage and build the new projects very carefully. We are not doing any low spread businesses. More than 3% arbitrage is possible for the future projects that we find. So several tens of basis points of higher interest rate hikes could not impact us that much. I hope that answers your question. Yes. Thank you. I read your story very, very interestingly on the integrated report about how to leverage or take advantage of the failures. Thank you. Next is Sato-san from JP Morgan Securities. Thank you. This is Sato speaking. First question about the US business. On page 31 of your presentation material, you are disclosing the numbers, and compared with the past, new investments are being controlled, you mentioned, and this time, the Real Estate system business segment is down. But as if you look at the total picture, it's flat, I think. So what you say, the controlling risk is what you are doing, and when you continue with that, the base profit of each business and other segment assets, what would be the trend of those? What should we expect? So if you can give us some more details on that. And also, the higher interest rate in the United States, could you comment on that as well? In the past, our loan charge, the interest payment would increase and also the U.S. segment, that would be positive, so it would be offset. And also, on another page, the interest, higher interest rate in the United States does not have much impact. So as of now, when you look at the current portfolio, the higher interest rate in the United States, how would that impact on your profit and loss, if there are any update? Thank you. So U.S. operation, first of all, most of the main business in the United States are private credit, so financial business. So PE, the amount is limited or small. So for Real Estate, it's multifamily finance and agency or sell to agency. And credit, double B or single B equivalent companies, we were providing loans to those companies. So single B, double B minus loans, there are some remaining, and right now, they're using the tangible asset, or rather, they are using the intangible assets, so the cash flow based is the collateral use for the most of the loans in the United States. When the interest rate rises, the cash flow on the customer side turns negative, so there are several higher credit costs and the increasing. And for the, we have already worked them out, and we increased the provision, so we have done the mark to market and then setting them up. So that's what we have in the United States. So after that-... Naturally, even when the interest rate goes up, basically, or we say that up to 5% or so, and it stabilizes, then, around 5% of funding cost will be the assumption, so that increasing the balance of the loan. And then in the future, when the interest rate comes down, then we can do the arbitrage. And also, 25 basis point is possible here, and probably we are reaching the peak. So we are trying to wait and see and start to make new investments, and then we should be able to make the quick recovery. As for the interest rate in the United States, as I said, a 25 basis point or 50 basis point, if it's within 25 basis point, it would be better. Especially ORIX USA, most of the assets are floaters, so fixed interest rate we don't have a asset at the fixed interest rate, so the impact will not be a big one on us. Also, Avolon and others. Avolon expectation and investment, they are all in U.S. dollars. So Avolon's, the earnings is improving and our, including our hedge cost, we think that it would take some time before the recovery. So we have to really reconsider the hedge cost. But as of now, the Avolon and others, for the U.S. denominated investment, the interest rate, interest cost, how to change that, and we are thinking that we should reconsider, but that's being reconsidered, so we have not yet made a final decision. In the future, this is something that we need to work on. Did I answer your question? Yes, thank you. Just a follow-up. ORIX USA, the floater assets and higher interest impact is, has been positive. So this time, in the first half, the segment profit or base profit results, higher interest rate, the positive impact is included. Is that the correct understanding? Yes, that's correct. Well, liability side is exactly what you said, but the asset side, with the higher interest rate, the customer side have a negative cash flow or a deteriorating cash flow and financing and have the loan. And that, I think, is the negative factor for ORIX USA. I see. The interest rate sensitivity is difficult to say, but the environment, of course, it is a mixture of positive and negative, and thank you very much. Thank you. Next is Daiwa Securities, Watanabe-san, please ask your question. Yes, this is Watanabe, Daiwa Securities. I have one question. Profit plan, JPY 330 billion. How strong is this commitment for the fiscal year? On page eight, you are showing capital gain outlook, one hundred billion lower bound is shown for the second half, and, four hundred billion for next fiscal year. Maybe you are tempted to prioritize that. And, utilization of, a capital has actually increased to 94%, and I think there is, of course, upside and downside, but, how strong is the commitment for the profit plan for this fiscal year? That's my question. That is actually a very difficult question. JPY 330 billion. JPY 100 billion, well, 20, well, about, eighty billion, considering we have, what we have done in the first half. This is basically according to plan, and we're hoping to do this in the second half. In January, February, during the end of the pandemic, we started to move forward with sales activities. But of course, there are buyers and their own situations, and sometimes they're late in responding to the situation. So negotiations starting from February to March would probably be concluded in the second half of the year. This is why the schedule is expected to be tail-heavy or second half heavy. But if this is actually possible, we believe that we can achieve this number, but it all depends on the customers. In order to achieve JPY 400 billion, maybe we want to delay some of them. Maybe that is a sentiment. But the sales teams have their own objectives for this fiscal year. If they cannot achieve this, there's going to be some pressure. So on the ground, I don't think any team is considering prioritizing the next year's profit target. Now, as I mentioned before, renewable energy-related matters, starting from next fiscal year, our operations will start in some of these initiatives. So once they're operational and the cash flow is stable, it means that we can exit immediately, and including Greenko. While Ormat was a little bit unexpected because of the Israel situation. A nd the sovereign risk is now materialized or maybe a little bit more difficult. But other than that, everything is basically going according to plan. And the next question is that to what extent we will have event risk? So that is basically one of the risks that we have to look at in terms of achieving the target. And excluding that, all efforts are being made so that we can achieve the target smoothly. Well, in terms of employed capital ratio, it could, I think it's going up, and also there is a possibility of buying the used car business. Do you have any idea or plans about exit? Well, we don't increase the bank lending dramatically. As I said before, Capital Recycling is at the center for our new investments. So we are basically recycling the assets from the older ones to new ones, and for the old ones, it's basically Capital Recycling. We want to increase the earning, and for the new projects, we use that funding. The employed capital ratio should not be very high. That is the very basic policy of our business. That's very clear. Thank you very much. Thank you. Tsujino-san from Mitsubishi UFJ Morgan Stanley Securities. Yes, thank you very much. The Banking and Credit in the presentation, the trust asset, JPY 1 trillion, and for the Real Estate loan, you have sold some of them, and this led to this amount. Until now, we did not pay much attention to that. So liquidation rate, how would that start to impact your earnings? And the new investments and new Real Estate market, I think that it's very competitive, so whether you are successfully doing this and also with the intensified competition, I think that the competition has been always intense. So what is going to be, how would you improve your position in terms of the gain on sales or the exit? Well, 0.7 ROA over 0.7 or 0.8, or their mission is to get to the 1%. So what they do is to make the earnings, and that means that their total assets would increase. And the JPY 3 trillion is the total asset in their assumption. And they have set up the earnings target. As a parent company, at JPY 3 trillion, and if it's 0.7, it's not good enough because ORIX Group ROA will be pushed down, so that is not acceptable. So our Real Estate as a loan is not the only thing we have. So especially about the banking, the Real Estate loan for the investment purposes, we have slowed it down. And the merchant banking, especially for the renewable energy project finance and also project finance, like, syndication, becoming a leader and, the getting the fee revenue and to, sell the assets. So that is the policy that they have. So to what extent are they successful in doing so? The total assets keep growing is not acceptable. So we want to control the total assets, and this, we want to reduce it from JPY 3 trillion to JPY 2.5 trillion and increase the ROA. So that is what we tell them or as, as a direction or instruction. So if they cannot do it, we cannot increase the ROA. And like back then, the selling or listing will not become visible. So when we consider listing in the future, at least ROA of 1% is necessary, and we have to take measures, initiatives for that. We can use the trust business so that the total asset can be reduced and increase the fee business. So that's what they are trying to do, as a target. So whether they can achieve them or not, it will be the will determine the future of ORIX Bank. I hope that answers your question. Yes, I understand the philosophy. So from now on, this, the JPY 1 trillion, the breakdown and, the impact on the profit and loss, if you can provide that information, in the future, that would be very helpful. Thank you. Thank you. SBI Securities, Otsuka-san, please ask your question. Yes, this is Otsuka. I hope you can hear me. Yes, we can hear you. I want to go back to what you said, Mr. Inoue, maybe I have missed something, so I just want to confirm something. USA, when you explained about ORIX USA, JPY 200 million underachievement, I think that's what you said. Is this about the profit being underachieved by $200 million? Yes. Post-tax profit target. ORIX USA in 2010 had JPY 750 million pre-tax profit. And that pushed up the target profit internally and the JPY 500 million, just under JPY 500 million pre-tax profit was target for this fiscal year. And against that target of just below JPY 500 million, and they will be under achieving by about JPY 200 million. That's what I meant. I see. So according to your document, well, on page 10, for example, you're showing ORIX USA profit being $55 billion. This is pre-tax target. So there is a possibility that you will not be achieving this, and that is why you are trying to offset this by profit from other segments. Is that correct? Well, JPY 55 billion, this is in yen. In terms of US dollars, that would be about $350 million. Would that be correct? Well, we are actually charging a lot of different costs for this segment. That is why we have this number. Yes. So JPY 55 billion is actually a quite tough target. And how can we somehow supplement, support that will be the key of achieving the JPY 330 billion target overall. I see. Thank you very much. Next, Sasaki-san from Nomura Securities. Sasaki of Nomura Securities, can you hear me? Yes. On page eight? I have a question. First of all, this type of disclosure, I have been covering you for a long time. This is the first time that I see this. So why did you decide to disclose this, this time? Could you explain the reason? And also, capital gain forecast were mentioned, and at when and which number were used to come up with this calculation? Could you talk about the assumptions? And also, if possible, the commitment of JPY 330 billion and also JPY 400 billion for the next year, I would like to hear your view on your commitment to achieve that. About as for the page 8, for a long time, the disclosure of ORIX were criticized from investors. There were some dissatisfaction, so we wanted to improve that. So different way of disclosures are being done. So this is part of this, our efforts. So in order for you to understand what would be the best disclosure and how should we disclose the numbers, we are always thinking about it. And this time, we decided to provide this, Capital Recycling, table, so that you can understand this better. So we are always trying to make improvements, and as a result of that, we are disclosing this page. Also, JPY 330 billion commitment, as I said earlier, the capital gain, well, in the past, the annual capital gain was from JPY 80 billion-JPY 100 billion. And those numbers, so JPY 80 billion-JPY 100 billion, this is based on the book value of our assets and with the gain on sale. So that means that the capital gain, in addition to the book value, and based on that assumption, we always make a calculation. So JPY 100 billion or JPY 80 billion capital gain. So this is the net profit on sale or gain on sale, so about JPY 400 billion. Similarly, there are multiple projects going on, and some of them are in development. And so in the second half, this year and early next year, gradually they will start to start up, and then we will consider to sell them and which project can be sold and what would be the level of the capital. Those are the validation, verification we go through. And then as a result, we think that we can achieve JPY 100 billion. And toward that target, we would like to proceed with the capital recycling or a setting of those assets. I hope that answers your question. So if that is the case, page 8, going back to those numbers. So you're negotiating with the counterparties, and based on those numbers, say that the JPY 20 billion-JPY 40 billion and JPY 60 billion and so forth, are mentioned. And if, if possible, when you sell which assets, what kind of numbers that you come up with? If you can... So, for example, you have so many private assets, so overall balance sheet, unrealized gain is very difficult for us to calculate. So this time, you are disclosing page 8. So if you can show us the denominator of those numbers, what would be the size of it, if possible? Well, first of all, those numbers right now are from the front line, and those are the numbers that they're using as an expected capital gain when they negotiate. So it's not just something that we calculated. So as for the denominators, Yano-san, well, depending. In the case of Real Estate, it's 1.5-2 times if it's old. And as for the PE, 1.5-2 times at the time on sale. So the book value, 1.5 times of the capital gain. I think in many cases it's that level. So that's the kind of image that will be coming down. So about the Real Estate, development NOI, that is the cost, and exit NOI. The development NOI is 5 to, for old one, it's 6% or so, and the new ones are 5%, and another NOI is 3% or a little more. So based on those assumptions, I think that you'll be able to match with those numbers. As for the PE investments, as you know, at the time of Yayoi, for JPY 80 billion, it was JPY 260 billion, so it increased dramatically. So how much the denominator is, it's difficult to say, and when we say it, the buyers might say that they're not going to buy at high price. So it's difficult for us to say about the PE investment. But renewable energy and others, and the Real Estate, especially the renewable overseas development NOI is about 8% or 9%. Exit NOI is 3%-4%. So those are the numbers for our exit strategy. For Real Estate, as I said, 5 is the entrance and the 3 is the exit. So if you consider like that, I think that you'll be able to have a good grasp of those numbers. Yes. So renewable energy, so it's like doubling, and if it's or it is likely to be sold. And in your segment disclosure, certain assets with a certain size are included, so that means that you already have a certain level of unrealized gains. Yes, that's correct. The issue is that when we disclose it, there will be an insider issue, so would like you to understand that. I see. Thank you. It's now clear. Thank you. Thank you. We're nearing the close, so this is going to be the last two questions. UBS, Okada-san, and then, Niwa-san. So we'll start with Okada-san. Yes, this is Okada from UBS Securities. I was looking at page 10, and full year profit plan JPY 105 billion for overseas. How likely is this going to be achieved? So overseas environment, energy, and Asia and Australia, hedge costs will continue to stay high in the second half as well. That's my expectation. So capital gain and also asset size increase in the second half, do you think that will enable the achievement of the targets? And also for Asia and Australia, compared to the last fiscal year, the profit level is maybe lower in the first and second quarters of this year. And do you think this is going to recover during the second half of this fiscal year? I want to understand the likelihood of you achieving the profit plan for overseas business. Well, for Aircraft and Ships, we believe that it is possible to achieve because we are selling off aircrafts and also ORIX-owned aircrafts offered to investors who want to use them as tax shelters. So we believe that for Aircraft and Ships, it's possible to achieve the target. And for vessels, we will be selling about 4 vessels, that's in the plan, and that's achievable according to the current market situation. Environment and Energy, especially Elawan, Elawan 's asset sales is in the center, in the focus. For Elawan, the profit contribution is has a 3-month delay. So can we do this before the end of the December? That's the question. If not, then 27 may not be able to be achieved, and it will be pushed out to the next fiscal year. So this is still in the flux. For Asia and Australia, again, we will have two or three to be sold. That's in the plan, and the internal process is ongoing. One of them we're trying to sell is an asset in China, and we need approval from the authority. So as long as the approval is granted, there is no three-month delay for this, so we can sell before the end of March next year. For Asia and Australia, last year we sold one lease company, and because of the absence of that, the number looks smaller this time around. But with regard to lease business there, we are seeing a steady recovery. But in terms of gain on sales, we will have, maybe one or two of these companies' sales, but we, we do not expect a big capital gain coming from this. So that is why we are presenting this number. I hope that answers your question. Okada-san, did it answer your question? Citigroup, Niwa-sama. Next, Niwa-san from Citigroup Global Markets. Thank you. My name is Niwa. I hope you can hear me. Yes? Thank you. The follow-up question about the Aircraft and Ships, I'd like to ask another question. There are three questions. The next year, what would be the segment profit expected? And the second is the collection of the insurance, what would be the timeframe, if you can comment on that? And the third, inorganic possibilities. I think that the aircraft industry is very active. As for the funding, it's not very easy, and it's not going to get easier. So inorganic possibilities, I think, it's quite, well, it's a good time for considering that. So if you can comment on that. As for the next fiscal year target, we are checking. As for the insurance, Avolon $300 million, we are asking for that payment. And AerCap and others, Russian insurance company, partial collection or recovery has been completed. So, domestic aircraft in Russia, if they go outside of the country, they will be foreclosed, so they don't want to have that. And so, the payment was done for part of it. So for Avolon, $300 million, out of the $300 million, the $70 million is going to be paid by the Russian company, so we are currently negotiating. But Lloyd's insurance company negotiation, it has become a litigation. So about that, will take probably 1 or 2 years. So if the collection $70 million from Russia is possible, then it's not going to take that much time. As for the next year, our target for Aircraft and Ships, although we have not yet announced this, about JPY 350 million-JPY 40 billion. So most of the JPY 40 billion or two-thirds is the aircraft, and one-third is ship, ships. As for ships, most of them are already sold. So the ships, unless there is a lowering of the marine transport, we won't be able to make an order, so this is not very clear. But as for the aircraft, it's very active. But as for the acquisition, acquiring at low price is very difficult. But the aircraft, we have an inflation hedging, so when the interest rate goes up, the leasing goes up, so no negative spread is likely to emerge. So post the pandemic, the lease factor is 0.5-0.6. Right now, it's 0.8-0.9. So this is because of the rising interest rate. So leasing of the aircraft, based upon the inflation and interest rate, it changes. So aircraft. How can I say this? There is not much negative impacts from the cost. I hope you answered your question. Yes. Thank you. Thank you very much. Master, with- Thank you. It's time to close the Q&A session. Lastly, we have closing remarks from Inoue-san. Yes. The numbers will be tail heavy, second half heavy, which may be causing some concerns among you. But, from October to December, in the third quarter, to what extent do we see progress in terms of capital gain? And, that will probably enable us to give you more detailed or more accurate numbers, when we do the earnings announcement in December. Interest rate hike in the U.S. is impacting our allowance for doubtful debt. It is increasing. We want to make some improvements, although it's difficult to do so. But other than that, things are going very smoothly, so we expect and appreciate your kind support going forward. Thank you. And that concludes the second quarter earnings announcement. Thank you very much for staying with us until this, until the end of the meeting. Thank you and goodbye. Over. Mm-hmm. Mm.