Thank you very much for bearing with us. Now I would like to start the briefing and question and answer session on the financial results of fiscal year ending March 2023 of KDDI Corporation. Thank you very much for participating in this session despite your busy schedule today. I'll be serving as the moderator today. I am Miyakawa from Investor Relations Department. This session will be live streamed over the internet with simultaneous interpretation from Japanese to English. This briefing will be made available on on-demand basis on the IR section of our company's website. I'd like to ask for your kind understanding. Let me introduce the people present here today. From the left-hand side, from the center of the front row, President and Representative Director, CEO Makoto Takahashi. From the right-hand side, center of the front row, Executive Vice President, Director, Executive Director, Personal Business and Global Consumer Business Sector, Toshitake Amemiya. Senior Managing Executive Officer, Director, CTO, Executive Director, Technology Sector, Kazuyuki Yoshimura. Managing Executive Officer, Executive Director, Solutions Business Sector, Yasuaki Kuwahara. On the left-hand side, left of the front row, Managing Executive Officer, CFO, Executive Director, Corporate Sector, Nanae Saishoji. On the right-hand side, in the back row, Executive Officer, Deputy Executive Director, Personal Business Sector, Hiromichi Matsuda. On the left-hand side, in the back row, Executive Officer, Executive Director, Corporate Management Division, Corporate Sector, Kenji Aketa. There are three pieces of earnings-related documents and two pieces of TSE disclosure documents. Total of five are posted on the website in the IR section. As for the descriptions in the materials and the financials results and contract target numbers that will be mentioned in the Q&A, as for those, please refer to the disclaimer in each of the materials. Let me first ask President Takahashi to give you the financial results summary, and then entertain questions. Over to you, President Takahashi. Thank you very much for participating in the earnings briefing of KDDI Corp despite your busy schedule today. Before starting to take questions, please allow me to give you the summary of the financial results of the fiscal year ending March 2023, and our forecast for March 2024. For March 2023 fiscal year, we managed to absorb impacts from fuel price hikes among others and posted record high profits. On the left, the consolidated operating revenue was JPY 5,671.8 billion, up 4.1% year-on-year. Operating income reached JPY 1,075.7 billion, up 1.4% year-on-year. On the right, the focus areas, including business services segment and the financial business, showed steady growth. Let me go over factors for changes in operating income. From the left, multi-brand communications ARPU revenues had a negative impact of JPY 85.3 billion. Group MVNO revenues and roaming revenues had negative impact of JPY 27.8 billion. Cost savings related to 3G closure had a positive impact of JPY 80.3 billion. DX financial business, a positive impact of JPY 28.9 billion. Others, including cost efficiency, had a positive impact of JPY 64.1 billion. Energy business, a negative JPY 8.8 billion. Impact of fuel price hikes was negative JPY 36.3 billion, which together brought us a full year increase of JPY 15.2 billion. Impacts of price reductions and fuel price hikes were more than offset by strengths in focus areas and efforts to enhance cost efficiency, which resulted in the growth in profits. Next on highlights of the forecast for the consolidated performance of fiscal year ending March 2024. The rebound in communications ARPU revenue and growth in focus areas are expected to offset the decline in roaming revenue. On the right, as positive factors for operating income, we anticipate multi-brand communications ARPU revenues and growth in focus areas, including DX and finance business. Negative factors are likely to be a decrease in roaming revenue and fiscal year March 2023 temporary accounting effects in financial business. Roaming revenue decrease is expected to ease from fiscal year ending March 2025. Lastly, let me give you the summary. As for the performance, we posted record high profits in fiscal year ending March 2023, despite temporary impact of fuel price hikes, et c. In fiscal year March 2024, we aim to increase in revenue and profit augmented by a rebound in communications ARPU revenues and growth in focus areas. In terms of sustainability management, we will promote sustainability management and enhancing the power to connect. In 5G communications, we'll promote initiatives for ARPU revenue rebound. In focus areas, we will work to demonstrate competitive advantage through synergies with telecommunications. We'll also promote initiatives, including HR, to strengthen management to support sustainable growth. With regard to shareholder returns, DPS for fiscal year March 2024 is expected to increase by JPY 5 to JPY 140, thus aiming for 22nd consecutive DPS growth. We have set share repurchase parameters of JPY 300 billion. We'll continue to aim for a sustainable growth, and thank you for your attention. Mr. Takahashi, thank you. We would like to move on to a Q&A session. To answer questions from as many participants as possible, the number of questions per person is limited to two. If you have two questions, please wait for the answer for your first question before answering the second question. Please raise your hand to ask your questions. My name is Masuno of Nomura Securities Co., Ltd. I have two questions. For the 2024 business plan assumptions. The first question, the roaming, the - JPY 60 billion and other, the profit, an increase of JPY 20 billion, they were reflecting cost cut, I believe. I'm wondering if roaming revenue will go down so much. As to cost reduction, according to the midterm plan, I think there could be more cost reduction. As to ARPU revenue, JPY 20 billion. The revenue will increase including ARPU trend. Could you please talk about the assumptions? I mean, the significant reduction in data revenue and how much actually the other cost will be need to reduced. Could you please talk about the background? I would like to explain about the roaming, and Amamiya-san will take me over. As to JPY 60 billion in decrease in roaming revenue, I think that you are thinking that it is very big. We are concluding roaming contracts, agreement and operation. We have been talking with Rakuten about it. As you know, for this the fiscal year, by the end of the year, that they are going to turn it around, their telecommunication business. For that, they have to then narrow down the roaming area rather significantly. The in terms of number of figures, JPY 60 billion reduction in our roaming revenue reflecting the reduced roaming area. Since then, our discussion continued, and today with Rakuten, we issued the press release. They are going to invest both in 5G and 4G, and that is very tough. The cash, rather than using cash for 4G investment, they thought that they would be better for them to extend the period for the roaming services or rather to reduce the range of reduction in roaming services. For us also, that we would like to invest more on the 5G, and it would be more effective to have to provide roaming services to Rakuten. That we announced what we announced today. From our perspective, we would like to reduce the ad revenue slightly. For this fiscal year, JPY 60 billion reduction will be mitigated to some extent because of this new agreement with Rakuten. I think that we can achieve over JPY 10 billion. The reduction that will be better. We announced JPY 80 billion today, but there will be some add-ons to the JPY 80 billion. That is our current forecast. I cannot talk about details about this agreement, but that is the big picture. From next year on, the reduction will be mitigated. As to other, Amamiya-san takes me over. As to other area, there are positive and negative included here. Other including energy, it says here. As to energy, next year, next fiscal year, we are aiming at the stable revenue flow. JPY 10 billion +, the profit increase is expected. The technology, the cost, the restructuring and about the JPY 20 billion, the positive number is expected. Why the total is $20 billion? Because there are some costs involved, especially today. ARPU increase, ARPU increase, that should be worked on, that we have been working on since last year, and that is the biggest challenge for us. We need to make au more attractive. That's very important. For that purpose, we are going to use more, spend more for marketing, so there's some cost. + or -, that calculated, this is the number, JPY 20 billion, as it's shown here. Thank you. As to ARPU revenue. The ARPU revenue, the increase is expected, and I think I asked about ARPU itself. May I? As to ARPU, in the first half, we are going to have a rebound of the communication ARPU revenue. At this moment, the numbers are quite good and within the first half, we'd like to see a rebound. To begin with, our thought is as follows. We would like to have our customers use as much as possible in a comfortable manner. That will lead to the increase in revenue and unlimited the plan usage increases and number increases. As to the traffic usage part, it is steadily increasing. In terms of au, every month, close to 30% increase year-on-year. For UQ mobile, the 20%, about 20% increase year-on-year in terms of traffic. Our customers are using more. With that, the au's max plan and UQ mobile's, they need to large the capacity plan like M and L. Those plans are increasing, contributing to ARPU increase. Our scenario, that is working very nicely. Thank you. For ARPU is expected to rebound within the first half of this fiscal year. ARPU revenue is going to rebound. The ARPU itself, well, within this fiscal year, we would like to see rebound, but as to ARPU revenue, we would like to make the positive trend. Second question, the EPS target. The JPY 300 billion, the share buyback. The JPY 5, the DPS, the increase. Is this because of the, you are targeting at the midterm, the EPS, and you'd like to control the number of shares? Is that the background? Could you please talk about your thinking behind those numbers? This question, I think, is a very important question. Last fiscal year and this fiscal year, the business environment has been very tough. Because of the significant price reduction and the fuel price hikes and the communication failures happened, the Rakuten roaming that was that started very nicely, but the revenue is coming down, which is offset by the ARPU revenue rebound and the cost reduction and the growth in the focus areas. That was the last year's situation. For this fiscal year, JPY 60 billion, the roaming revenue reduction, though we would like to reduce this range of reduction. The communication failures and the fuel price hikes had impact of JPY 35 billion. But we did not reach the externally published numbers, but the actual number ended up with JPY 25 billion instead of JPY 35 billion. For this fiscal year, JPY 60 billion reduction in roaming revenue. We have been doing some workouts so that we can mitigate the reduction in roaming revenue. From this fiscal year and onwards, we will not see many negative elements, except the revenue reduction in Rakuten roaming. The fuel price hikes or the communication failures and the price down, that we are going to see rebound in the price this year as well. Not so many negative elements. From next year and onwards, the picture we believe that that will be much better. The 5 times EPS target was announced 3 years ago, I think, or 4 years ago. We did not expect the big impact from the price down or communication failures. It seems that the current status is 1 year or so behind the plan. We are not going to give up this 5.5 times 1.5 times CPS. For that, business growth and the shareholders' return, such hybrid approach is necessary. For the, for 1 to 2 years, the business growth was not so big, so we would like to show clearly that we are committed to shareholders' return. JPY 5, the increase this year, DPS, and the JPY 300 billion share buyback. Those are the numbers that are showing our commitment. Although we are going to make effort to grow more this year and year after next as well. Thank you. Thank you very much. Next, if you have any questions, please raise your hand. Yes. The second row in A, at the back, please. Mitsubishi UFJ Morgan Stanley Securities. I am Tanaka. I have two questions. Before that, Mr. Masuno's question, JPY 60 billion in decline for the roaming, you said that more than JPY 10 billion increase. It's not - JPY 60 billion, it could be as little as JPY 50 billion. Is that what you mean? We are looking at a bit better than that with more than JPY 10 billion. For the data book, in ARPU, actual results, communications ARPU is JPY 3,870 in the quarter, the fourth quarter, and JPY 180 decline. This is more than we, I had expected. For the single months in the second half, you were expecting a rebound. That's what you said. JPY 180 decline in ARPU in the fourth quarter. Can you explain more about this? Amamiya-san, please. Well, the biggest factor is the connection fee and retrospective billing will be included in March always. In March 2022, March, and March 2023, comparing these two, the March 2023 was bigger. That was the biggest reason why the ARPU didn't stop falling. For the other factors, most are in line with our expectations. As I said, in April, the things have been going as we had expected mostly. If you just look at the fourth quarter, that may be the impression that you may have. For this fiscal year, we believe that things will go as we had assumed. 100- of the JPY 180, the settlement of the connection fee, how much is represented by that? Well, that is not disclosed. I'm sorry for that. Several tens of JPY. Well, if you say several tens of JPY 50 would be the one that you could have as idea. au ARPU is on the positive side. Brand composition review is something that is ongoing. Also access charge retrospective billing is also included. In any case, as we went into April, year-on-year multi-brand communication ARPU revenue mostly on par with the previous year. In the first half of this fiscal year, if you multiply ARPU and ID, the multi-brand communication ARPU revenue should be reaching the rebound within the first half. That's our target. Thank you. For the second question, as for multi-brand IDs, 31.2 million as of the end of March. How much is UQ and povo of this? What would be the number of IDs in the new fiscal year? What would be the composition that you're expecting? Amamiya-san, please. First of all, for the composition of IDs, the breakdown, slightly more than 70%, is au. As for UQ mobile, the things have been going well continuously. It is almost reaching 8 million. povo 1.0 and 2.0 together have reached more than 1.5 million. You can understand what is the composition of the brands. As for au composition ratio share, how to maintain that share of au is the biggest challenge for us. Compared to last year, this year, the number four is declining. The share of au, the decline in the share of au has been reduced. For this fiscal year, we don't expect as much decline as in the last fiscal year. The migration from au to UQ was more, but that has been slowing down. From UQ to au, the migration of this customers that are doing this migration is increasing in number. For this composition breakdown, the decline in au is expected to slow down in this fiscal year. Well, the multi-brand ID, the total number of IDs in, at the end of March 2024, what would be your expectation? Well, as for the forecast for this next fiscal year, 31 million. Because we have reviewed the definition, the number of total subscribers has been counted even if they have not used the total. The number of users that have been billed is the new definition. 31.23 million is the number of IDs. 30.88 million is under new definition. That would be 31 million as of the end of March 2024. When you look at the press conference by SoftBank, they are talking about net growth in smartphones, and 1 million is a big number, they said. We also counted the number in our company, and we are reaching the similar level. We would like to also review how to disclose these numbers. The number of smartphones is important, so we would like to also share that information with you going forward. Thank you. JPY 30.88 million-JPY 31 million, I think that is quite small, isn't it? Well, it's the number of IDs. From the feature phones, well, this is just about the right number. Well, this may sound a bit weak, but if you look at the current moment, there is also an issue of so-called 1 JPY handset, and there was some re-restriction that is being applied. In that sense, it may seem a bit weak. Thank you. Thank you. Please raise your hand to ask your question. Okay, one front row, please. My name is Andel from Daiwa. I have two questions. First question about consumer. This year, marketing budget will increase year-on-year or decrease? The churn rate is rather high. What is your attitude toward marketing? Could you please elaborate on that? Thank you for the question. Amamiya-san, please. As I mentioned earlier, to how to make au attractive, more attractive is very important. For that, we would like to spend firmly for marketing. It's not that we have not done it before, but we would like to do more of the data so that more efficient marketing will be exercised against the other money that we spend, how much effect is there, and we would like to verify that constantly. I cannot talk about specific numbers. For example, last year. Sorry. For March 2023, in the first quarter, the marketing cost was reduced slightly. Compared to this year, this fiscal year, marketing cost will rise compared to that. For clarification, marketing cost, Amamiya-san, is the contract, the, it's the cost to obtain contract or for the agent-related, the cost? I'm talking about the sales and the promotion cost. What about the agent fees? As I mentioned earlier, we are going to use more of data to be more efficient. As to the overall amount, it's at a downward trend. The unit basis, it's not so different. We'd like to find a way, a more efficient way to do marketing. Second question, it's about the business services segment. Business services segment is becoming larger in terms of profit contribution. For the investment, the business services segment, where the IT services companies are listed, many of them. Is it different from your business services segment? I think you are coming into that phase to make that distinction. As to NEXT Core business, compared to IT services companies, I think there are overlapping parts, but what is the nuance? What is the strengths vis-a-vis IT services companies? What is the opportunities for growth? What is the earnings structure? Could you please explain in differentiating yourselves from those players? The NEXT Core is the other non-communication part. It's related to SI mainly, and also the core communication part. Our growth potential is for NEXT Core DX, SI areas. What is the difference from SIs? The biggest difference is as follows. We are based on communication business, so there are many contacts with communication business, and there are many customers. As to IoT, though we can differentiate ourselves in the area of IoT, that is the biggest part. From the telecommunication part, what we call DX, such as managed DX, we have been expanding from the areas which are closer to telecommunications. Using IoT, we can utilize data. Using data, we provide next services and solutions. That's the picture. The biggest difference with SIs lies in these areas. Have I answered your question? Yes. Thank you. What about the profitability? Recurring revenue includes the communication revenue, your profitability would be very different from that of SIs. Am I right to understand it that way? Thank you. Yes. The model is, the base model is recurring model. The lump sum, the front revenue, followed by recurring revenue is the picture. The 17% or 18% is the current level. The similar, the profitability is factored in our model. In our presentation on page 20 or 21, we talked about such flow from the existing customers to MRC, and how the profitability is enhanced, and what is the difference with SIs. Going forward, we would like to give more detailed explanation in the future. Thank you. Mr. Andel, did that answer your question? Yes. Are there any other questions? The second row in the B at the back, please. Thank you. I am Okumura from Okasan Securities. The first one is multi-brand ID number. From the upgrade from UQ to au is increasing. That's what you said earlier. At the moment, downgrading from au to UQ and upgrading from UQ to au, what is the balance between these two? Within this fiscal year, is there any equilibrium that you can reach? Then there could be some upside or upgrading. Is it something that we can see as a conservative number? Well, we have not disclosed the absolute number, so I cannot be specific on that. We're not reaching the equilibrium yet. From au to UQ, that migration is larger still, but it is declining. Migration from UQ to au, the rate of this migration is increasing. Compared to last year, or compared to March 2022 or March, in March 2023, we cannot… Well, this has been increase of several folds, not like in percentage. We have to reach the equilibrium. In order to do that, how we can encourage customers to use more au by increasing the attractiveness, and that's how we are going to hit the balance. I'm sorry, we cannot be so specific. Sorry. Thank you. The second question is, going back to where we are. I would like to ask more about roaming. From June, there is going to be a new contract, as according to the lease. Based on the lease, you talked about areas to be covered, including the cities. Also, it is reported that the price is going to be reduced. Has there been any reduction in price? If there is, then as far as possible, if you can share with us, how much reduction was there? As for the contract terms and terms, we have reached agreement with SoftBank that we will not disclose this, so it's very difficult for us to share that with you. What has been reported as a great reduction in the price, that is just a speculation. For us, the period of leasing the network is going to be extended, and the rate of decline is going to be milder, which is beneficial for us. For Rakuten, their investment in 4G can be compensated for by roaming. Whether you spend the cash on capital investment or spending cash in roaming, that's the choice. In terms of areas, the 23 ward of Tokyo would be included. This, in exchange for that, there will be some period of change. There's not, it's not that, there's a simple reduction in prices. There was some modulation in negotiation. Well, thank you. When you explained about roaming, the roaming revenue in the previous fiscal year was slightly less than JPY 100 billion. If the reduction is not JPY 60 billion, but JPY 50 billion. Is it conservative or is it really this much reduction in the roaming revenue decrease? Actually JPY 60 billion decline was expected in our plan. Because of this new contract, it is going to be more than JPY 10 billion improvement. We cannot disclose the total amount. Please forgive us for not showing that. Thank you very much. Thank you. Please raise your hand if you have a question. C, second row. My name is Moriyuki from SBI Securities. As to market liquidity, so the churn rate, not just to you, but the churn rate generally is increasing. Why? All the players have been focused on MNP, and maybe that is impacting it. The return rate is on the upward trend. How should I think about it? There are factors to raise it and factors to decrease it. I think most of them exist. The first quarter, the handsets were so cheap and such plans were sold. The 1 JPY, the reseller was a problem. The result of the investigation by the FTC, they came out and they showed some guideline. There are some control and constraints. The churn rate went up because of the first actor. The second, the thing that I said, actually decreased churn rate. As of the end of May, there will be the one-stop services. That though will increase churn rate. In our case, I think other companies are doing it, but in our case, we have been promoting service bundling. Historically, it started with communication and handset and the fixed line and the other telecommunication, and then telecommunication and financing. With that, the liquidity in the market will go down. There are both factors. The higher market liquidity is not about news. The migration to 5G will bring more traffic and more output. It's not just only negative things. To see churn rate go up more, that will not be good for us, and we are going to control it firmly. Yes. I, interested in how the things will go. The second question. There were some questions about the number of IDs, to make au more attractive, you said. About your marketing strategy up until last year, MNP, the new subscribers was the focus, but now maybe you are moving toward the changes of the upgrades of the handsets. The additional MNP or the additional IDs. Rather than that, ID times pool, in other words, revenue increase, top line increase are more important to the business people that I have been emphasizing on the importance of that thinking. From this fiscal year, are you saying that the marketing strategy will change? As we have been saying, the very beginning of this fiscal year, the target was the rebound in the communications pool revenue within the first half of this fiscal year. For that, we need to raise our pool. That is our very strong focus. For that, we need to increase 5G handsets. Then the other net increase in smartphone is very important. SoftBank, 1 million smartphone users SoftBank is talking about that, and we are going to do the similar things. Pool is the focus. Our focus is on the top line increase. It's not only the telecommunication, but the value added. The portion is very important. Including all that, we are aiming at increasing the top line. Thank you. Thank you very much. If there are any other questions, please raise your hand. The first row in D, please. Mizuho Securities, Horie. I have 1 question. As for the shareholder returns, once again, I'd like to ask a question. You said a hybrid strategy, it was understandable. Of the JPY 1.5 trillion, the JPY 500 billion for year, there is additional JPY 100 billion seems to be quite large and generous. If you increase by JPY 50 billion, then that is more understandable. JPY 100 billion seems to be quite large and generous. We tend to consider the next fiscal year onward, and you're talking about finance business and expanding portfolio and also maybe you want to do more of M&As. That's what we thought. JPY 100 billion in shareholder returns will be done in this fiscal year because there was good performance in the last fiscal year. You want to do M&As, but there's no good opportunities, and if there is any good opportunities in next fiscal year, you could reduce the shareholder return and go for more of M&As. Is that what you're going to do? M&As, it's not a must for M&As. How to spend your cash? Is there any M&A that you have as a perspective to change the balance? In the midterm, the JPY 700 billion is going to be spent for growth strategy. That's what we said. Because of COVID-19 and others, the, in terms of opportunities, there is no good potential deals that we were able to find. In the Evolva and Relia integration, what we wanted to do, actually has been realized without spending additional cash. After the pandemic is over, there is actually more of those deals. There are deals that are we considering that is increasing. In the areas of DX and global deals and finance and Web3 deals, those are all on the table for discussion. We would like to capture one at a time. The JPY 300 billion in dividend increase and shareholder share repurchase, this JPY 300 billion in parameters. Because we haven't been able to grow too much in last year and fiscal this year. We would like to demonstrate our commitment to shareholder return. Actually, there are smaller number of negative factors. We, once we, have this idea that we can reach 1.5 times more in EPS, then we may review the shareholder return policy. We have been increasing the dividend consecutively and the 22nd 22 terms. I hope that you will be stay tuned for the next fiscal year onward. Thank you. Next question, please. It seems that the... I do not see any other hands raised. With that, we would like to close the financial results briefing for the KDDI Corporation for the fiscal year ending March 2023. Thank you.