My name is Kato. I'll talk about the overview of the financial results as well as the outlook for the March end of 2027.

The consolidated financial results. This is the three points in the financial results digest highlights: EPS has increased by 11% to 158.4 yen, ROE is 11.6%, ROIC is 4%, three indices have been all achieved its targets.

In a consolidated operating profit, 13% increase to become 50.2 billion yen. This is the increase in five consecutive quarters and achieved its targets.

In segment: retail 2.3 billion yen increase of the profits, fintech 3 billion yen increase and achieved the targets, and also the and also the 7% increase in 28.5 billion yen in the current profits, and achieved profit by 500 million yen to achieve its target plan targets. Financial 11.6% in ROIC and ROIC ROE is 11.6% exceeding the shareholder equity cost, ROIC exceeding the WACC.

Also, this is the final group total sales has a record high 5.7 billion yen increase by the previous quarter, 52.2 billion yen in operating profits, and also 1.9 billion yen exceeded to become 28.5 billion yen. The operating profits, current profits are also achieved its targets.

Then the 3 billion yen increase in due to the non-operating expenses. However, the current profits increased by 7%.

Extraordinary profits in in accordance with the impairment of the equity as well as some of the loss due to the closure of the store. This current profits a 7% increase to achieve 28.5 billion yen.

In the fintech profits, this is the revenue profit and operating expense profits. Retail operating profits it's increased to become 11.2 billion yen.

Fintech operating profits is a record high 47 billion yen. For both segments achieved increased the profits.

In the also the retail plus the fintech retail retail plus 2.6 billion yen, fintech plus 2 6.8 billion yen, in total expense is plus 100 million yen. Excluding the special factors, that is a 9.5 billion yen increase of profits.

Also tenant revenue have increased, that is increase the expense has increased, that is the we achieved the 11.2 billion yen for the the rents and the expenses the that the those proportional rent has increased. This is the transaction volume in the 44 months has increased the previous year.

It is a higher level than the Tokyo region department store in the 111% compared to the previous year. In the tenant revenue segment, the minus 500 million yen, and also the the due to the variable rents 2.3 billion yen increase in the tenant revenue.

This is the card. This is the due to the sales increase in the area, non-operating area has decreased, declined to 4,700 tsubo due to the some of the withdrawal of our own sell own store base.

Compared 5% increase and now became 70%. That as planned, the category has been increasing.

The next is the fintech situations. In the fintech, this is the breakdown of the operating profits.

In the this is due to the change of the revolving and installment payments, the 6.8 billion yen increase in fintech. Then this is the including the special factors, it is a 3 billion yen increase.

The card credit, this is a card and credit card, and in the in the 10% increase, 1.2 so this is a 1.2 1.2 trillion yen, this is a record high. This is the merchant commission rate, this a merchant commission rate compared to the the due to the revision of the foreign exchange rate commission fees, they have increased by 22%.

This is the revolving and installment payments in the March ending the 473.2 billion yen expanded. This increase, this is the if looking at the industry compared to the 20 March the 1.1 times in 2020 March, but now it is 1.7 times that to be the case compared to the other peers in the industry.

This is the the commission fee revenue due to the revision of the fees since October has expanded to 69 billion yen, which is a 9.4 billion yen increase. Next is the new memberships.

In the 2026 March, in the entire new card issuance is still ongoing, but then card supporting the suki has increased and increased by 50,000 to achieve the 870,000 people members. These card numbers of membership is the record high 8.3 million yen.

The suki-supporting card members are 1.38 million people. The Platinum and Gold Card added the percentage is including that is ratio is 64%.

The this is the decline in the repayment of the profits, repayment of the yield and interest, and so the the 1.5 billion yen has been placed as a provisions for the loss of the repayment of that. This is the total asset with the account receivable increase compared to last year end, 87.9 billion increase of 1.1413 trillion yen.

Equity ratio compared to last year end, less by 2%, 21.4%. In terms of the capital allocation, the basic cash flow, we had the 2.6, borrowing 4.5, 1.8 for growth, and then dividend 21.4, and then the share buyback 7.7.

Also, in terms of the human resource investment 9.7, total investment is 27.7. ESG situation: the main external valuation, METI Nadeshiko brand, we were the first 9 years in a row selection.

Other health-related management, we are the first for retail, we are selected for the last 9 years consecutively. In terms of the renewable energy 100%, we have our own solar generation from 2027, we will be improving by 97% for this year.

Then we did have our own generator during the Ukraine crisis, our electricity bill went up by 30% 2027 March. Even with the Middle East crisis with the tenants included, we will be plus 17% price, it's half of the Ukraine crisis.

In terms of the outlook for March 2027: EPS 4% growth, 16.4 billion, ROE 11.8% will be higher than previous year. Group total will be 9% increase, 5 trillion 900 billion, and then operating profit 10% increase, 55 billion, then net income will be 4% increase, 29.5 billion.

In terms of the ordinary profit with the interest rate going, we have minus 34, but we have the operating profit, some 3% increase of the ordinary profit, 44 billion. By segment, this is the operating profit: retail 3% increase 11.5, fintech 8% increase 51 billion.

The retail segment operating profit plus and minuses, tenant income and event will be expanding. In terms of the other utility costs, we have increase of 800 million.

Lessening of the real estate increase, there will be down of 500 million, we will have a 300 million yen or so operating profit for fintech. With the expansion, the merchant fees and the installment and repayment fees changes, actual operating profit will be 3.5 billion.

Because of the interest repayment loss that we accounted for last year, there will be 4 billion yen for the operating profit. Per-head dividend: DOE 10% we will maintain for March 2027.

It will increase by 3 yen to 134 yen. We are increasing for the last 15 terms.

That's all from me. Thank you so much.

Now we would like to have direction for suki business. Our CEO, Mr.

Aoi will present.

This is Aoi. I would like to talk about the business supporting suki and going forward.

We have the vision of the economy that is driven by suki, we have the business that is supporting suki. The business that supports suki, through suki, it's consuming something for somebody, and society through suki is what we want to do, the impact to society.

We are using our benefit to launch into new businesses and evolve into the new businesses. First, we will do the businesses to support suki.

We up to now retail, fintech, we have the co-creation investment with a triology, we will putting suki in the center, we will evolve all of the three aspects. First, retail.

In retail, we have event, goods, cards, suki support unit will be the main ones. Store management, operation, we have events to support EV, and then our own private brand expertise goods will be utilized, and our unique feature, we will continue to draw more card membership through our services.

The unit that supports suki, we are able to change our way of managing stores as well as opening our policies. Yokohama, where we closed in February, we have a unit specializing in suki to reopen.

Yokohama membership, 70% are coming to the suki events, through this change, 1/45 of the area and then 1/10 of the staff, we are able to make sure that we are drawing more membership, it's much more efficient sales. Especially efficient operation, we have other different types of outlets.

In Osaka, after Namba Marui, we have our second store that is supporting suki. If the operation unit succeeds, then we can make the asset of the store efficient so that we will be more of the asset-light business.

Next, we will talk about fintech. Up to now, Gold Card was drawing the growth and driving growth.

By adding the suki support card, we can grow in new areas up to now. Becoming a general card to Gold Card, we are seeing more usage, and then people are using their Gold Card as their main card, and there will be more usage, it's a two-stage approach for our royal customer.

Royal customer is simple for the Gold Card, but it's very effective. Past 20 years, we have had 19% increase every year, which is a very high growth.

March 2026 also in terms of what we traded, 75% increase was from the Gold Card. As you can see, absolute Gold Card, on the other hand, EPOS card, we think there is potential that we can draw from.

This diagram I would like to use. This is the royal customer outline by Gold Card in numbers: the new member 100, of that 45% of our customers invitations are sent out for Gold Card; of that, 20% of the customers switch to Gold Card; and of that, 15% of them make it our main card, therefore they become a true royal customer.

On the other hand, those customers who do not apply to the invitation, or even if they become a Gold Card, they don't use it as a main card, they are 5% of those, total 30% of those. Meaning that the loyal customers 15%, double that 30% is still left behind, so that's our great potential.

Therefore, utilizing the suki support card mission, we would like to take all of these 30% customers into our royal customer path. To do so, the core competence, we would like to co-create trust.

For that purpose, we will practice co-creation of the trust, which is a core competence. The founders express the trust is something not given to the customer, but rather trust is to be co-created with the customer.

Gold Card is relatively closer to the trust that we give to the customer, but the suki-supporting card is the co-creating the trust, and royal customer creation will be proceeded. Here, the important point is the self-confidence and self-positive attitude toward oneself in regards to the management of money.

In Japanese people, in general, has the less knowledge about the finances, and the self-confidence is quite low in terms of financial management. Therefore, some customers feel I'm not really good enough to be have the Gold Card, therefore they would hesitate to switch to the Gold Card and they would not use Gold Card.

That is about 30% of the customers that I just explained. By the suki-supporting card, increase it for them to become our loyal customers.

More specifically, until 1970s, since inception in Marui store, we have the communication with customers face-to-face, we have done in the stores. In the application, AI technology will be utilized to be reproduced again such a customer interaction.

Based on that, to support the customer's self-confidence by providing the appropriate feedback at the appropriate timing. This communication with the customers, that is the trust is something that is not just given, but also the customers themselves would grow that confidence and to gain the trust.

That they as a result of the one's trust to be grown and credit to be grown each according to each customer, they would eventually become a royal customer, and that is a business to be supported. The suki-supporting card, the co-creation of the trust in the volume of be 1.5 to 2 trillion yen will be the increase of the revenue.

Also in the invitation standard is not reached in those 55%, those are the other company's credit card are used as a main card, but then by recommending suki-supporting card, we will promote the switching and churning to their main card to become use ours. In the pet card, the 10% about 10% of the members switch from EPOS Gold Card.

Among new members, the other company's main card, there are certain numbers of customers who have switched from other company's main card to our card. Those suki-supporting card, other than just the status that you can buy paying money, but also represented in the love for their pets.

This is a priceless suki or like or love is valued as very important as a for the customer. Through this card of supporting suki or their individual interest, that has been those 50% 55% of the customers now recommending them to switch to our cards to be for them to become our loyal customers.

In 2031, the 15% of the customers will become loyal customers by 2031, therefore the transaction volume which should reach an increase of the 300 billion yen to 500 billion yen by March ending in 2031. In main card ratio will become would increase from 23% to 35%, so that group transaction volume to reach 10 trillion yen is our targets.

This is the fusion of retail and fintech, and now the card membership to be collected. The loyal customers with the combine the retail and fintech so that we can support the long-lasting customer journey.

Not just the event for to get our members, but also the suki-supporting card, we provide the experiences. This is linked with the lifestyle application.

The event can be reserved, and this is a service for the members. This will be implemented, then the customer's suki-based event announcement as well as the preferred reservation and invitation can be used at the benefits.

This is a goods, these goods are sales in charge of the retails. The goods provided for the members are differently resourced from the person in charge, but now we're going to merge the two by having the more unique own goods, as well as the through the sales is also monetize our sales, and also to the original benefits provided to our card members as well, and for as a cost.

The retail and card will be combined to be fused. Initial cost will be hedged by the revenues in retails, and also the initial red ink can be recovered to achieve the over the lifetime achieving the business model and the profits.

The need and call sales and fintech to be fused together so that we can achieve this effect by the joint cost-sharing, and so that we can increase our profit ratio. Startup collaboration to be increased in a co-creation has been reduced in the recent years due to our review on collaboration policy.

In the future from now on, we'll be supporting the business supporting the suki, and also conversion, IP and contents, those non-tangible assets investment will be done to promote further collaboration. Next is a DX strategy, digital transformation strategy supporting suki.

A more tailored, personalized communication to promote the creation of the trust, and also data to be utilized and AI to be utilized and so that they can achieve marketing. Events and goods are linked, online and offline experiences can be combined together through the suki or likes to support each individual happiness.

This strategy is a professional resources in the DX area. We didn't have much of the tech image before in Marui Group, but now thanks to the efforts by Mr.

Tsuchiya, our CDXO, former Marui Group Goodpatch president, and from April, Tokyo University Yutaka Matsuo research coming from that research lab AI Mr. Sugiyama, executive chief technology officer.

Goodpatch also a joint venture, Muture, UX design special software development internal can be internally done in Marui Intec, product development specialist, as well as key supporting unit, data utilization experts as well. The DX strategy will be further promoted by supporting suki.

This is for the co-creation as well as also how we should work in the future business development to be made. More specifically, since 2024, employee's own likes suki can be developed into business development, and suki-supporting business concours has been done.

240 employees in the past 2 years have applied in 120 152 plans, and their liking of the museums and art museums, museum card and support of animal card has been commercialized. We have been expanding the participants to outside to the public from 2026.

Broadly idea has been collected first try, but out of 170 applications, about 130 of them are from outside.

The breakdown: other companies and overseas people, university graduate students and long-term intern people. The topic was space, washima, lacquer, and philosophy.

This is the day of the contest. Various types of suki is presented, and support from the audience, it was very much a big help.

Through this place of co-create, Marui Group's strength and the suki of individuals can be merged together to have very diversified suki. For this business, we will have various employment as well as mid-term hire, as well as contracts, as well as long-term internship.

We will have a work style based on project. In that case, company will not be a box where they will split the external, internal.

It will be a more free place where people can come and go, as well as utilizing their expertise. Using this co-create place, we would like to create a way of working so that we can get excellent talent from around the globe so that we can evolve into a company that supports suki.

The new structure for our board: for the last 12 years, external director Okajima-san is going to be retiring this year, and then the new external director, Mitarai-san, is from the McKinsey & Company as well as has been a fellow for the Kingdom of Bhutan, and right now is the president for the Kesennuma Knitting, a management that has both impact and profit at its core. Also, our director is changing.

Kato and Kojima are retiring, and the new candidate for the director is the senior managing executive officer, EPOS president, Aida, and also the senior manager corporate planning, Endo. Also, we have a director that we will increase from Goodpatch president, the CDXO senior officer, Tsuchiya, will be recommended.

In the June general meeting of shareholders needs to approve these new members. We would like to expand as well as make sure we can have a switch of generations for March 2031.

We will make sure we all achieve our target. That's all I have for you.

Thank you. Thank you for your time.

This is Otsuka from SBI. Do you hear me?

Yes, thank you. Two questions to Mr.

Aoi. One by one, is that okay?

Yes, that's fine. First question: today you talked about in terms of that trust, page 56.

After 56, you had mentioned some of these engagements, which is very interesting for me. You want to elaborate on this for 56?

Of course, as you mentioned, especially financial service in terms of credit is providing for. The financial institutions normally think in that approach.

In terms of co-create idea is a differentiator for you, I'm sure. The question is for the differentiation, how would you like to bring it into more solid?

For instance, as you said, suki support card, then that will be something that you can benefit. Like you commented, the 30% of the people who are still not necessarily have no suki support card or no plan that they can relate to.

The digital communication that you will be using as a tool not necessarily you are not able to hook these audience and they may not feel the attraction to what you're providing. Strategy going forward, that's first question.

One by one. Thank you for the question.

In terms of trust co-creation, to be more specific and how to make it more possible, if I make it very short, before from starting of our business late 1970s, we said, especially 1960s or '70s, it's hard to imagine from today. At the very top of the floor of our store, we had a payment counter.

Every month, customers would come to make their payment to us, and our employees face-to-face would receive that payment for the repayment. Actually, there is a lot of dialogue going on.

For instance, every time when they make payment, we say thank you, and there's a conversation. For instance, after they finished their 10-time payment, you're done with 10-time, not just saying thank you and expressing appreciation, we say this is just a token of our appreciation, we will give them a gift.

We used to. Then those customers still treasure those gifts today.

It's that putting our appreciation into the gift from the customer limited income, whether they were able to pay the whole 10 times, they are so relieved that they were able to pay up all the installments and to be thanked for that, having it in the form of a gift. It means that they were able to build up their credit, their trust.

It's a psychological benefit that they can be positive about what they've done later, we analyzed. Those customers, there's quite a lot who are happy with themselves.

Our trust co-creation credit card business, customers, we want to be very sympathetic to how they feel. These are the expertise we have in our company.

Unfortunately, in terms of the storefront communication going away, our communication with customer is getting less. We want to revive that kind of relationship is what I explained to you.

For instance, today, lifestyle app, we have to engage with customer or communicate with customer every month, the closing date. What kind of communication today?

We will close soon, are you okay? If you want to do a change to the revolving type of payment, you can tell us when and we can change it to a lesser amount and then make it in a new revolving.

The new payment date, we don't have any comment, but just if they are late to pay, there's a telephone or there's a short mail sent, and we ask them you need to pay us soon. For instance, we want to put our minds in the shoes of the customer.

We should say thank you on the day they made the payment for that installments. We start there.

If it's a 10-time payment installment, then we say this is done, you completed, this is just our appreciation, if you don't mind, we can give them a suki target gift, like a stuffed animal, or digital something, is the way so that we can recreate what was there in our history. Sorry, I'm getting long-winded, but how we can make this possible based on our history, the expertise.

This is our core competence, actually. Others cannot copy our own unique capability is how we appreciate this.

We are able to sympathize with this kind of method. This, inevitably, is going to be the source of how we can deploy, and what we said, the top-tier DX UX to recreate, we need dedicated professionals.

Fortunately, we have some very capable people here who are working together with us, together with these people, our staff are working with these talented people, professionals, to create the experience that other companies are not able to match. This is a new business that we work together with our customers is the differentiation that we're looking for.

With a financial money lending contract was made, and then however, the customer receive being told thank you and by being able to do that, that is a very good factor to evolve further communication. If you have some data, I will let you know as well.

More specifically, in the current suki-supporting business, what is the progress or any effect that you are able to achieve from that business? From Mr.

Aoi's viewpoint, are there any favorable results? For example, employees also is there many situations where the employees themselves will be encouraged from that?

Are there any positive achievement and positive aspects that you are able to achieve? In addition, what are the negative or somewhat not achieving expected results from the suki-supporting business?

In terms of positive things, as you just mentioned, with this suki or likes to be the good trigger, the employees who about 65%, very high percentage, and now that percentage is increasing. In addition to that, I'm very pleased with the fact that suki-supporting business concours was held this March, and for the first time, we have also opened it to outside the company as well.

About 100 140, close to 140 ideas, or close to 130 ideas come from outside the company. These ideas were proposed, very good proposals were given, or very passionate proposals were given to us from outside the company.

Those who have received, we want to commercialize and to put that into business as well. These ideas can be collected from outside and can be used in an event and goods and cards by Marui, and combining with our existing business, and suki-supporting business can be started one after another.

That is what we are actually happening. That was the thing we have thought about even though it was just started, but it is now seem to provide a better results.

On the other hand, what is somewhat negative or not achieving yet was, as your second question, the suki-supporting card to create the trust. Those who are the experts who can support this are participating this suki-supporting card and business, but now we have the members are now there, players are now there, but then we further need to implement this and to realize such business.

I think there's still some room for grow and there are still some conceptual stage. We will need to make more efforts in this area to further make it grow.

That's all, thank you. Thank you very much for answering my question.

Thank you very much for your good question. Thank you.

This is Takai from Mizuho. Thank you very much for a very easy-to-understand presentation.

Two questions. Number one: same with the first question, the suki support card, how to expand that?

You previously told us your operating cost is very low, even that is very difficult for other peers to copy. One possibility, this sort of suki support card, having this, it's not communicated properly, but people don't know the content very well.

They're very vague. It's very very difficult for them to use that card.

Or people who are non-users, you want to expand it to non-users, you need to have more recognition, awareness. One of them is the Umeda, the new store that you are opening in Umeda in Osaka, so that you're more positive about your own self kind of.

Those message, you need to expand it to people who don't know you, or how would you like to go about expanding this? It's number one, thank you.

Thank you for the question. Yes, suki support card is very, compared to before, has great opportunity.

The opportunity lies in large way to improve awareness for many people to understand what we did before. Until we communicated, people didn't understand us, but for instance, suki support card, the original source.

Before, we had the engagement, anime events, we would work together with in the card. Those sorts of credit cards working with anime from 10 years back, we have been doing.

Through that operation, we understood those anime contents fans normally in social media X, everyday they have frequent communications within the community. Within the community, we would send a message to this community, then that becomes a big hype within the community.

It gets transmitted by them also, by the community. Communicating to the fan community, the speed, the scope compared to before, it's easier for us to get in touch with this group.

Using social media already, the fan community is already established, we can notify them. The fans, actually, can communicate to their peers is how we are able to communicate.

Using suki as the core, we are getting a big advantage through this. Of course, we will continue to communicate and introduce people to these sorts of cards aggressively, but on the other hand,

cost and without us putting too much effort, the fan themselves are able to communicate. That structure already exists for us, so that is our businesses that we are very appreciative of in the nature of it.

Thank you. That is why the business concours that is also open to the public, that is very good.

Including those aspects, those ideas can be collected more broadly from the audience, and so that you can increase and you can grow the community, and then this will be naturally expanding from those efforts. Is that correct?

Yes, that is correct. That is what we are thinking.

Yes, thank you. My second question: in that new organization, you mentioned, could you please let me know the very new members are also wonderful.

Also, you're including the young employees and as well as the external directors. Compared to before, I think you have the younger generation working more, and those who are knowledgeable in the business has been the new members of the Board of Director meeting.

How do you want to evolve your Board of Director meeting? That is my second question.

Thank you for your question. Okajima-san has been working for long time to increase our company value.

Okajima-san has joined 12 years ago. At that time, the share price was 1,000 yen.

Now that our equity price is three times more, 3,000 yen level today. After 12 years of his assignment, now he is retiring from that position, and the successor is Mitarai-san.

Mitarai-san also have been introduced from Okajima-san, and they have worked in McKinsey & Company before. Both of them have worked in the company before.

Mitarai-san, and also in the Great East Japan Earthquake, Mitarai-san was at the Bhutan Royal Government Prime Minister fellow, and then she is doing the social business quite successful, called the Kesennuma Knitting. This is a social enterprise she's been working.

Now she's been joining us as an external director so that we can increase our corporate value. In case our internal director, we have increasing internal directors.

This is from Goodpatch representative director, Mr. Tsuchiya.

He is already executive officer, CDXO and digital transformation officer, and Mr. Tsuchiya has been the non-permanent officer.

Now thinking about our future directors within the board, we do need a person knowledgeable about digital and technology, so that is what we felt we need such an individual talent. That is why, as we have discussed internally in a board meeting, and we decided to invite this time we would ask Mr.

Tsuchiya to become our internal director at this time. The other person is currently the president of EPOS Card, Mr.

Aida. He is the managing executive officer and CDO, and he had worked in the corporate planning as well as he had worked in the putting the news source in Hakata.

He was also the founding member of that store. Both in the credit card as well as the retail.

Mr. Aida is very knowledgeable about business.

He has done the operation of the company as well as for the business, we like to ask Aida-san to become the internal director. Ms.

Endo, she would be the youngest, but she is the IR in charge of the IR, and also she's a corporate planning director, FP&A, and she's very knowledgeable about figures and numbers, and also she's very experienced and knowledgeable in the business management area as well. Mr.

Kato is a CFO, but Ms. Endo is a future potential human resource to succeed Mr.

Kato in the future. Mitarai-san, Endo-san are females, with the average age with these two individuals, the average age of the Board of Director members would become younger, and this toward the 2030, we'd be trying to get more younger members included in our business management as well as the Board of Director meeting members.

That is what we are trying to do.

Thank you. Thank you for your answer.

Thank you.

Do you hear me?

Kato-san, fintech business, I need to confirm, so that's the reason for my question. Up to now, in the material, you used to put in terms of the loss, and then changes in the fee commission impact, usually you would put it into the material.

I was not able to find it myself in terms of 2026 March, the original Q3. At the end of the day, the actual, what is the situation I would like to know.

And 2027 March, for the first part, the positive of the fee change, commission change, the original plan, raising the fee, the operating profit benefit, 2026 March, 4.8 billion. 2027 March, 12 billion would be the number.

2026/3, it's going to be a plus 7 billion. However, in terms of you have a lot of the depreciation by quarter, you are trying to fatten out.

In terms of the plan, 2027 March, the number outlook, how do you have the plan laid out? Yes.

I would like to respond to that. First, the 2026 March, we talked up to now in terms of installment change fee, 4.8 billion.

They assumed that transaction is not going to change to went by 0.2, it's 5 billion instead of 4.8. 2027 March, what we said, no change in the numbers.

It will be all benefit of the fee. We won't do this in this fiscal year, but going forward, all the expense costs structurally will be readdressed, annually in terms of the credit liquidation, we want to make it negative, asset securitization, we want to make it negative for the quarter.

We want to make sure it doesn't go up and down too much. That's a specific area that we want to be more specific about.

Kato-san, by quarter, this chart I used to receive. You're not going to make that available?

Previously, when we closed for the Q1, this year also after Q1, we should be able to give you a better plan outline that we can share. Understand.

Another confirmation is the year that closed, Q3 cumulative performance, it was an upside with fintech? Yes.

However, Q4, the upside is getting more extra. Strategic cost is going to be put into Q4, I believe.

In reality, value, how much did you account for here? Also, 2027 March, the strategic cost expense, what's your direction?

Please comment to the extent that you can comment today. Strategic expense, we wanted to use, but as we said, interest repayment that we had account for was more than expected, so as a result, we couldn't build on it.

Therefore, rather we accounted for some of the loss, we put 1.5 for the interest repayment, we were able to for this year. There, revolving changes in the fees for digitalization, for the app development cost, we want to account for more, so that we didn't have any bad debts, therefore we want to have a database build up, we want to spend more, is what we wanted to do.

We wanted to lessen ourselves with a bad debt.

My name is Shigeoka from Daiwa Securities. Thank you for explanation.

I have three questions. First question is on the fintech, also relates to that fintech issue.

You mentioned about the expense increase in fintech in the slide of the factors of increase. 16.1 billion yen expense has increased compared to the previous year.

That is some of the factor for the reduced profits. Compared to the last year's situation, the sales link, the point expense portion seems to be quite large.

What do you think? Sales promotion expense, you may be increasing the sales promotion expenses.

I'd like to know the background. Thank you for your question.

For the March ending 2026, we have the points we have provided the service has been reduced from the previous year. Therefore, not that much difference in the last year.

However, this year, this goes back to the usual situation. This is the expense increase.

The March 2026 is actually smaller. In a sales promotion expense, as I mentioned before, the future application enhancement and data to build more databases, we would need more expenses for the future investment.

That is why we have increased expenses. What about the system expense is also 700 million yen increase?

Is that also related to that? That is for the renewal of the servers we plan to do.

I see, understand. Thank you.

My second question is about loyal customers, for the Gold Card to be promoted that I understand that you're promoting the Gold Card and suki-supporting cards is being added as well. In which one do you focus on the two?

Because the customer is going to choose as a main card as a Gold Card is this not a both of the Gold Card and suki-supporting card? When does a customer change from suki-supporting cards to switching to Gold Card, the card face would become change as well?

What do you think?

Let me answer that question. For the Gold Card and suki-supporting card, those two in the past we only had Gold, but now we have the new card, suki-supporting card, is newer and it we have done discussion how do we support how do we establish these two cards.

The difference from the Gold Card, the they would can become loyal customer that is a different from the Gold Card. That, for example, of course there are some contrasting idea.

Concept would be suki Gold Card, but we don't have that now, that idea. That I I do remember the numbers in those table, those who have not able to get them as our loyal customers, they because they feel more anxious and they have less self-confidence.

Now these cards can also address those type of individuals to become a loyal customers. As today, Gold Card plus alpha is this suki-supporting cards.

In both this is like a two wheels of a vehicle that to promote more and more numbers of the loyal customers. In case of loyal card, it is a the number had to be changed due to the Visa guidelines and rules, but the suki Gold Card, they can use the same number if the card, and so that improvement is also can be done in the suki-supporting card.

That two can co-create the trust together. We provide the benefits as well as experiences for the suki-supporting card members.

There's a bonus point for the Gold Card, and the lounge use at the airport for the Gold Card. That's the difference from such general one, like a Gold Card benefits.

That is the suki-supporting card has a unique benefits and reward and benefits. We made our own Marui's own unique rewards and benefits for suki-supporting card.

That this can further also link to these retail sales and combined with the credit cards. In that sense, our profits ratio margin can be further increased to achieve more loyal customers.

That is our future stance. Thank you very much.

Not everybody Gold Card. Suki support card,

hopefully they become main card, is how you want to drive them? Yes.

The 10% people who received Gold Card are very happy, and they would use it as their main card. People are very happy.

I've met with many many people who said so, but some feel that Gold Card is too much for them, both customers, the 20% are happy, but we want both of them also to be happy. Thank you very much.

Last, number three. In terms of the share buyback in your material after 26 for the capital appropriate 30 billion, the timing you didn't say after 26 was what was written.

No change in your idea? If there's any update, please.

I should answer that idea has not changed. In terms of the capital allocation, 31 March, if we can build on the profit and then the retail capital will be too large, 30 billion or so we want to do share buyback was the plan.

However, retail, fintech, only when the profit rises, we will have too much capital. As of today, not yet, in the mid-term plan, second latter half of the mid-term plan, we would do it.

Then itself, no change in the direction. Thank you very much.

That's all for me.

SMBC Nikko Securities, Kanamori-san, please. My name is Kanamori from Nikko Securities.

I just want to focus on two questions. First question in this performance results in this quarter, fintech KPI fourth quarter, or rather full-year results is also included, but per capita the loan balance 1,000 yen decline on loan balance, and also revolving, and from the second quarter, year-over-year there's a declining trend on year-on-year.

The fourth quarter, revolving payments, and compared to the first and second quarter, in the first and second quarter, that was a double-digit number. In the fourth quarter, that was reduced to 6.7%.

That is some of the concern I have for the fintech business surrounding environment. If there's anything that is my first question in your fintech business.

Let me answer your question. In the fourth quarter, the installment and revolving payments that is due to the macro factors in December, that's been expanding from December, and also the reduction of the government that we started from the fourth quarter.

Similar situation is happening in other companies as well. From the first quarter there's some declining trend, but that is just slightly so that we're not worried about this so much.

My second question: in a flow chart, fintech part, Shiraoka-san has asked, I maybe did not mention, the guarantee, 1.3 billion yen for the rent guarantee, what is the background of that reduced profits of 1.3 billion yen? Also debt is 1 billion yen profit declining, and this will be reduced in future.

I think you are also looking at the amortization of that, the sales proceeds, can you divide them into the sales profits, the sales proceeds? Also, gaps between the current profits versus the operating profits, the 11 point has expanded.

The profit expanding in the 3.4 billion yen this red ink has been expanding in the profits. Is it be due to the payment of the interest rate, or I'd like to know your plan ideas?

Let me answer your first half of the question you just mentioned. For the guarantee of the rent, this is non-proportional to the volume of transaction.

This is for the revenues. This is most of the service revenue there's a 1 billion yen profits should be generated because of that.

For the liquidation of the debt of the credit, and that we've seen amortization of the credit will be continued, and also sales proceeds also should happening. In the minus 1 billion yen that level that we can control.

The operating profit is 3.5 billion yen, we can reduce this liquidation portion of that, which I will explain more in detail in the first-quarter explanation.

You also mentioned about the current profits is minus 3.4 billion yen, that is the impact from the interest rate, mostly coming from the interest rate. I understand the answer.

Thank you very much.

This is Kaku from Nomura Securities. Thank you for your time.

Since you don't have time, I have two questions. The credit securitization, the level change, interest hike, how will that impact your profit?

Minus 1 billion year-on-year, is what you said in terms of the liquidation of receivables, 2.7 billion. So 10 billion for this year, mid 10 billion after fiscal year, if you're going to reduce the leverage idea if you have any.

In terms of liquidation with the interest environment, the housing loan liquidation, you would stop. You are doing a lot of the revolving.

If you can talk about that, please. I would like to answer that.

The initial interest going up, the interest that for lending we are raising, it's not an issue. Going forward, what do we do?

In terms of the interest hike annually, 12 billion we have benefit from. Last year and this year, interest hike 7.7 billion impact.

We have another 3 to 4 billion to go. We will hedge to do the liquidation.

As a result of that, the total loss we do not want to impact is what we think. Did that answer the question?

Thank you very much. Next question about suki and premium card is my question.

Increase of this card and the breakdown, unit price going up could impact your financial numbers? Do you have anything that you foresee?

Fourth year after membership, fee jumps up high. 2023 March, suki-centric card is increasing for you.

Going forward, the financial numbers, how will it be impacted? If you have any idea.

Yes, I'll answer that. First from membership, second, third year, the unit price goes up.

As I said before, this year 870,000 people, 50,000 increase. This year we will challenge the same level.

Industry overall new membership is lessening, we are able to grow the membership, we can do a good job. Suki support card and Gold Platinum, with a new membership, naturally the Gold and higher will go up.

The suki card the unit price is higher, they are young people, they are using the installation revolving. After next year, the installation revolving will continue to build up, we think from next year onwards.