The time has come to start the meeting of the consolidated financial results for fiscal 2015 for Hitachi, Ltd.

First of all, I'd like to introduce the speakers for today. Mitsuaki Nishiyama, Senior Vice President, Executive Officer and CFO; and Mr.

Mitsuyoshi Toyoshima, General Manager of Finance and Accounting Department; Ken Mizoguchi, Executive General Manager of Corporate Brand and Communications Division.

I would like to ask Mr. Nishiyama to start the explanation.

I would like to refer to the PowerPoint presentation entitled the Outline of Consolidated Financial Results for Fiscal 2015.

Please refer to Page 4. These are the highlights for the fiscal 2015 results.

Revenues was JPY 10,034.3 billion, which is up 3% year-on-year. It was higher in Social Infrastructure & Industrial Systems, Information & Telecommunication Systems and Automotive Systems segments.

Adjusted operating income was JPY 634.8 billion, down 1% or a JPY 6.4 billion decline year-on-year.

And there was -- Automotive Systems is strong, but the profitability of Construction Machinery segment declined because of the slowdown.

EBIT was JPY 531.0 billion due to higher costs recorded for business structure reforms. Net income attributable to Hitachi, Ltd.

stockholders is JPY 172.1 billion. This is down JPY 45.3 billion year-on-year.

The factors will be explained later.

The total Hitachi, Ltd. stockholders' equity ratio for Manufacturing, Services and Others was 25.6%.

The free cash flow is JPY 324.4 billion, which is up JPY 187.1 billion from the previous year. The year-end dividend for fiscal year 2015 was JPY 6 per share.

Now regarding the results of MHI announcement in May 9 for the South Africa project, the JPY 379 billion request of payment was made by MHI. Now to this point, we cannot accept this request.

And in fact, this has been already referred to them on April 6. However, we have set aside certain reserves regarding this matter.

Page 5 is the statement of profit or loss. At the very top, revenues was JPY 10,034.3 billion, which is an increase of JPY 259.3 billion.

The JPY 210 billion [ph] regarding the weak yen impact is included. And if we exclude the reorganization, it will be around 100% or flat.

And next is adjusted operating income, JPY 634.8 billion. There was a demand decline in China as well as resource nations.

And JPY 15 billion was the impact of the foreign exchange. We have not been able to reflect this, and we have seen a deterioration.

EBIT was JPY 531 billion.

Income tax changed significantly at JPY 165.2 billion, which is an increase in burden of tax by JPY 43.1 billion. There are 3 factors relating to this.

First of all, in 2014, the income increased for listed companies, therefore, there was a pushing of DTA, which went away in 2015. Now secondly, because of the consolidated taxation group profit improved, therefore, we have to start ramping tax again.

And Hitachi Capital reorganization, there have been some transfer of stake and tax relating to DTA. It had to be posted in 2015 because of this reorganization.

And the impact was JPY 43 billion in terms of tax increase. This is having an impact on the bottom line as well.

On the right-hand side, we have shown in the previous forecast comparison. In terms of revenues, there was a difference of JPY 84.3 billion, positive; adjusted operating income, plus JPY 4.8 billion; but in terms of income tax, there was a further increase by JPY 38.2 billion, which is relating to Hitachi Capital, as well as Hitachi transportation systems reorganization required these costs to be posted.

Another change is loss from discontinued operations to the tune of JPY 57 billion. Out of the thermal power business, there were projects that were not transferred to the joint venture, which were dealt with by Hitachi, Ltd.

in terms of these projects. JPY 39 billion has been posted.

This is being subject to negotiation with various customers, therefore, we cannot give you details about this cost relating to contracted terms, and that required additional reserves in 2015. And that means that compared to the previous forecast, there was a deterioration of JPY 67.8 billion.

And Page 6 is the factors affecting changes in adjusted operating income year-over-year. Now on the right-hand side, cost reduction, et cetera, JPY 231.5 billion.

And the left-hand side, however, there was JPY 120 billion in terms of lower sales price. Furthermore, the investment in business development, JPY 43 billion.

And increase in labor cost and depreciation, JPY 70 billion. This was covered by the cost reduction.

However, as you can see toward the middle, there was a lower utilization, inventory optimization of JPY 20 billion incurred. This is for Construction Machinery as well as Materials and Automotive System.

Our product demand declined, and production had to be downsized. It has an impact in lower utilization, inventory optimization took place, which amounted to JPY 20 billion negative impact.

Exchange gain is JPY 15 billion. However, overall, because of the inventory optimization having a significant impact, it was minus JPY 6.4 billion year-over-year.

Next is for EBIT. As you can see in the middle, exchange loss, the impact is minus JPY 9 billion.

As I mentioned earlier, we saw a JPY 15 billion increase in terms of operating level, but a JPY 24 billion minus impact on a non-operating basis was incurred. And also, the investment in business development having a minus impact of JPY 22 billion in terms of structural reform expenses.

Investment in business -- in Hitachi construction material, 39 -- JPY 49.5 billion was a net gain on business reorganization and other expenses. And EBIT, however, deteriorated by JPY 3 billion at JPY 531 billion year-over-year.

Page 10 is the revenues by market. Now Outside Japan ratio for 2014 was 47%; for '15, 48%; and year-over-year, 105% for Outside Japan.

We have seen decline in Asian -- China as well as other Asian countries. And China was 95% or -- and 99% for other Asian.

But 88% for China; and for ASEAN, India and others, would be 89%, if not for the impact of foreign exchange.

Air-conditioning business was restructured, which is having an impact. The Construction Machinery and others have seen a decline in demand in Asia having an impact.

On the other hand, for North America, Europe, there was an increase. For North America, Hitachi Metals, Waupaca Foundry has been acquired, increase is seen.

Europe, the Ansaldo acquisition of railway business has led to an increase.

Please refer to Page 13. This is the balance sheet summary.

The upper half is Manufacturing, Services and Others; lower half is the Financial Services. For the total assets for Manufacturing, Services and Others was JPY 9,917.9 billion.

And you can see that there was an increase from the -- and regarding CCC, our cash conversion cycle, it was 81.8 days at the end of 2015 March, and it has been reduced by 10 days to 71.6 days. Hitachi, Ltd.

stockholder equity ratio, 25.6%, and D/E ratio was 0.4x.

The lower half is for Financial Services. Our total assets is JPY 3 trillion -- above JPY 3 trillion.

Hitachi Capital global business has grown, which is included in this increase. D/E ratio is 6.74x.

Next is Page 14, cash flow. The middle is the Manufacturing, Services and Others.

Cash flows from operating activities has improved to JPY 843.1 billion because of the CCC improvement. As a result, free cash flow came in at JPY 324.4 billion, an increase of JPY 187.1 billion year-over-year.

Please refer to Page 16. 16 and 17 are the segment information for 2015 in terms of revenue as well as operating profit.

Looking at Information & Telecommunication Systems, our product-related business was slow, and deterioration have been overcome by system solutions and, as a result, increased by JPY 6.1 billion. And profit margin was 6.7%, operating profit margin was 6.7%, and 7.9% for system solutions.

And therefore, overall is 6.7% is the best operating profit margin after Lehman shock.

Next is Social Infrastructure & Industrial Systems, a deterioration by JPY 7.5 billion in terms of operating income. Overseas, in the Middle East, there are major projects as well as realization [ph] in chemical plant are coming to a close.

Projects have deteriorated. Oil and gas market deterioration has led to a decline in terms of compressors, so the pumps products has been negatively impacted.

Projects have been negatively impacted and showing a deterioration in the number.

For EBIT, there was a decline of JPY 81.2 billion year-over-year. From 2014, there was a profit from business reorganization, which is absent.

Foreign exchange impact was JPY 10 billion overall. That is the reason why we have a negative number for EBIT.

For Social Infrastructure & Industrial Systems, compared to previous forecast, it has deteriorated by JPY 50 billion. Operating profit, the JPY 8.6 billion deterioration has had an impact, and this is relating to infrastructure.

Middle East project has seen a faster increase, so we had to satisfy the reserve for this. In addition, at EBIT basis, there is foreign exchange impact and the structure reform and fixed-asset impairment is included.

Construction Machinery, the Kokusai Electric and the Hitachi Koki has had an impact of 5 -- deterioration of JPY 5.5 billion. And Construction Machinery has declined by JPY 37 billion because of a slowness in the Chinese market.

High Functional Materials numbers are shown here. For Automotive Systems, in the past 3 years, we have continued to increase the business, and JPY 1 trillion has been achieved in terms of revenues.

In addition, profitability has been improving as well. 2014, it was 5.1% in terms of operating [ph] profit margin and has improved to 6.2%.

And next is Smart Life & Ecofriendly Systems, a decline in revenues as well as EBIT because of the air-conditioning reorganization. If we exclude this, if we look at white goods only, we have seen increase in revenues as well as earnings.

Others, logistics and other services. Now Hitachi Transport System has improved, are increasing the revenues as well as earnings.

But EBIT has declined by JPY 10.4 billion because of the land proceed gain has gone away.

Financial service increased by JPY 6.2 billion in terms of operating income. For our corporate items and eliminations, EBIT was subject to a significant change.

This is because in the previous year, we posted major items, which is not included in this year.

Next, Page 19, please. Let me talk about fiscal year 2016 outlook, starting with 19.

This is the underlying premise of our forecast. Regarding the business environment, there is a continuing uncertain situation due to sluggish economic growth, mainly in China in natural resource and oil-producing countries.

And the summary for fiscal year 2016 forecast. The conversion of Hitachi Transport System and Hitachi Capital Corporation to an equity-method affiliate are factored in.

The exchange rate assumption is JPY 110 to the U.S. dollar and JPY 120 to the euro.

Now let me explain the numbers on Page 20. Revenues, JPY 9 trillion; adjusted operating income, JPY 540 billion, 6%; and others, yen strengthening impact, and Hitachi Transport System and Hitachi Capital impact, and so the number will go down, but operating income ratio will be maintained at 6%; EBIT, JPY 450 billion; and net income attributable to Hitachi, Ltd.

stockholders is JPY 200 billion.

Next, Page 21, please. This is the increase and decrease of revenues and operating income, centering on the business portfolio restructuring.

Left side is revenues. Exchange loss of strong yen is minus JPY 380 billion; impact of reorganization of Hitachi Transport System is 9 -- minus JPY 490 billion; Hitachi Capital Corporation reorganization, minus JPY 135 billion; and air-conditioning business reorganization impact is minus JPY 100 billion.

So JPY 9 trillion.

Adjusted operating income on the right side. Exchange loss, negative JPY 60 billion; impact of reorganization of Hitachi Transport Systems, minus JPY 28 billion; Hitachi Capital Corporation impact, minus JPY 27 billion; and air-conditioning business impact, minus JPY 8 billion.

JPY 540 billion is the forecast. Now Hitachi Transport Systems, the sale of some of our shares will be in the first quarter, Hitachi Capital in the second quarter.

This is when we expect to complete the deal.

Next is Page 22 and 23, let me talk about forecast by segment. Information & Telecommunication Systems will be down by 3% in revenues, but operating income will be JPY 143 billion, up JPY 1.6 billion.

On the other hand, EBIT will be minus JPY 25.1 billion year-on-year. The server and storage, the product-type business will have the business restructuring expenses.

Next, Social Infrastructure & Industrial Systems. Large loss in the previous year, large costs in the previous year will be -- no longer be there, and so we will see an improvement.

Electronic Systems & Equipment. Hitachi High-Technologies development costs will increase and Hitachi Kokusai Electric, semiconductor, equipment will go down, so it will be down by JPY 2 billion.

Construction Machinery, sales will go down by 5%, but with the impact -- positive impact of the business restructuring in 2015, and improvement of product mix will push up the operating income by JPY 11.3 billion.

High Functional Materials & Components will be improvement of JPY 6 billion, but EBIT -- Hitachi Metals sold Hitachi -- Hitachi sold the shares and the impact will no longer be there on 2015, so minus JPY 29 billion.

Next, Automotive Systems. Operating income down by JPY 1.9 billion.

This is ADAS, autonomic -- autonomous driving development cost will go up.

Smart Life & Ecofriendly Systems. This is the impact of the reorganization of air-conditioning business, so down in operating income.

Others. Hitachi Transport System is included, but this will be gone from the first quarter.

And so the revenue will be 51%, and operating income will go down too.

Financial Services, 36%, and down by JPY 30.2 billion. This is Hitachi Capital reorganization impact.

Now Others segment. This had Transport Systems and services and others, logistics services and others, but we have changed the name to Others because of the reorganization.

Last, Page 25, and onward. Let me talk about the summary of the Mid-term Management Plan.

Page 25 shows some numbers, shows adjusted operating income ratio. Fiscal year 2012, operating income ratio was 4.7%.

Fiscal year 2015 is 6.3%. Our initial target for fiscal year 2015 was over 7%.

We could not achieve that, but we were able to secure over 6% ratio. We saw a big improvement in system solutions business in Information & Telecommunication Systems, that was 6.7%; in Automotive Systems, 6.2%.

So these segments, businesses were the driver of the improvement in the operating income ratio.

Second from the bottom, cash flows from operating activities. Fiscal year 2012 was JPY 503.4 billion; fiscal year 2015 was JPY 843.1 billion.

And it's not listed here, but cash flow margin ratio 2012 was 5.7%; fiscal year 2015 was 8.6%. So we realized an achievement.

This is the record high level, so we now have more cash-generating capability.

Next, Page 26, please. On the other hand, there are some challenges.

At the bottom, you can see challenges. Number one, one is speedy response to changes in the market.

We cannot be speedy enough. IT-related projects, management, IT product-type business, we had some delays in keeping up with the market environment changes.

We are trying to reorganize our business to speed up, so we need to accelerate our management further. Under the new organization, we will accelerate the decision-making.

Other is the thorough project management. In IT-type business in Information & Telecommunications business, we had some unprofitable projects.

And we no longer have that. We now have good phase-gate management and project management.

On the other hand, in infrastructure, the Middle East construction projects and others, there are some unprofitable projects. And so we lacked in project management capability there.

However, we are going to focus on our strong points. So we will focus on our areas that we are strong.

Next is accelerating business portfolio reform. Social Innovation will be the center of the management resource, and so we will reform our business portfolio.

Next, Page 27, please. Initiatives for the next stage of growth.

One is business restructuring. We will continue the business restructuring activities, mainly around the low-profit businesses in fiscal year 2015.

Structural reform expenses was JPY 90 billion, and the benefit was JPY 20 billion. In fiscal year 2016, we will continue this business restructuring, especially around the low-profit projects.

We will go ahead with reforming the problems areas. Structural reform expenses will be JPY 80 billion, and benefit for -- through the measures in 2015 and '16 will be JPY 55 billion.

So in 2016, the benefit will be JPY 35 billion. We will try to enjoy the benefit as well.

Second is accelerating business portfolio reform. Hitachi Transport System and Hitachi Capital, which we announced today, they will be equity-method affiliates.

So we will be active in reforming our business portfolio going forward.

Now number 1 and 2, if we conduct these measures, our revenue will temporarily go down, but we will not be afraid of the revenue decline. We will expand the Social Innovation Business to grow organically and through M&A.

We will focus our investment in this area to grow steadily. Fiscal year 2016, we will first do the review, reform of the business portfolio, so the top line will go down by 10%, but we will do what we must do.

And on the other hand, we will expand and take measures to expand the Social Innovation Business. Growth area strategy will be explained on the 18th of May from President Higashihara.

That's all. Thank you very much.

We would like to move on to the Q&A session. The microphone will be brought to you.

Please wait for the microphone to be brought to you.

I have 2 questions. First question is regarding fiscal year 2016, or you talked about the price decline as well as other cost factors were explained.

So for this fiscal year, I would like to know what your assumptions are?

Regarding the increase and decreases, it is basically regarding reorganization. From 2015 to 2016.

In terms of operating profit, the most significant factor will be business structure reform impact, the increment of JPY 35 billion. That is a major factor.

There are others. Price decline as well as cost reduction will be offsetting each other.

Therefore, in terms of the total, the business structure reform is the most significant factor that will influence this.

Now regarding personnel costs as well as the depreciation and -- I think JPY 113 billion was mentioned for the last term. What is the number for this term?

Now for 2016, how we should evaluate, is that a price decline?

Minus JPY 100 billion plus is what we have assumed. In terms of personnel costs as well as depreciation, JPY 30 billion.

Especially in terms of depreciation, it's going to be very significant this term. Now in terms of the business structure reform, the increase of JPY 35 billion and JPY 170 billion for personnel costs.

In terms of development related, at the time of April, Dumada [ph] was announced. And that's an increase of JPY 40 billion compared to the previous year.

It's a minus alpha impact which will occur anew. I hope that will suffice.

Now regarding the second point?

On Page 16, you have talked about the Social Infrastructure & Industrial System EBIT has declined in terms of -- compared to the previous forecast by JPY 52.8 billion. In the beginning, you explained the increase in reserves for South Africa.

Is that included in this number? And regarding South Africa, when you have accounting process, are you setting aside for your equity stake of 35%?

Is that the case?

Regarding South Africa, I'm sorry, but the detailed numbers cannot be disclosed. Regarding the accounting process as well as how it is going to be posted cannot be divulged in terms of details.

However, I can say that a reasonable number has been set aside as a reserve. About the details of the accounting precision, cannot be explained at this point in time.

On the part of the media, you said JPY 100 billion was mentioned by the media. So regarding this JPY 100 billion, can you say that it is correct?

Or is it out of scope? Because this has been mentioned everywhere in the media, so please comment regarding JPY 100 billion.

In terms of the actual amount, basically, we cannot disclose information. How they are handled is not explained in details, not by MHI or not by Hitachi.

And I do understand that JPY 100 billion has been mentioned elsewhere, but we are not in a position to comment on this number. Regarding the reserve that we have set aside, it cannot be disclosed in terms of the actual number.

Any other questions?

I have 3 questions. First, this year's business restructuring cost goes up by JPY 35 billion.

If you could elaborate or give us a breakdown on that? Last year was JPY 20 billion, this year is JPY 50 billion increase in profit.

So the cost will not be that much bigger, but the benefit will be so much bigger. So which segment, which division will be more prominent?

So please give us the breakdown. That's my first question.

Second, maybe I'm misunderstanding this, but on Page 21 and 23, the drop in sales and profit due to the non-consolidation, taking out of consolidation, their numbers are different. And so why is the result in the forecast different?

Which page was that again?

Page 21. JPY 490 billion down in revenues from the Hitachi Transport System.

In Page 23, Others, revenue will go down by JPY 600 billion or so. Why is the number so different?

And same for the Financial Services, the numbers are different. And so I would like to know why.

And my last question is cash flow. You said you are having cash flow, good amount of cash flow.

In the new fiscal year, cash flow margin or free cash flow amount, what is your forecast? What is your plan, please?

That's all.

First, the business restructuring expenses, the breakdown. First, fiscal year 2015, the headcount adjustment was JPY 450 billion of the -- JPY 45 billion of the JPY 90 billion; and then depreciation, total JPY 90 billion; and 2016 is JPY 80 billion.

The headcount adjustment is JPY 30 billion; and the impairment of fixed asset, JPY 50 billion. In terms of headcount adjustment in 2015, 4,300 people are in the scope; in 2016, will be around 3,000 people.

So the positive impact on operating income is bigger this year than last year. So JPY 30 billion is going to go up to JPY 50 billion.

In fiscal year 2015, impact is JPY 20 billion, but this is mainly in the second half. So in fiscal year 2016, it will be a full year contribution.

So that is around JPY 45 billion. And in fiscal year 2016, we are going to do the restructuring of JPY 80 billion.

So JPY 10 billion is incorporated. So total, JPY 55 billion.

Now to answer your second question, the differences in the numbers is -- in revenues, it may sound strange to you. In the waterfall chart, this is after the intercompany elimination, so after the elimination, it's the decline in revenue after intercompany elimination.

And therefore, Hitachi Transport System is JPY 490 billion; but in Others, it's JPY 600 billion minus. Now the difference between JPY 450 billion and JPY 600 billion, about JPY 110 billion is the intercompany elimination.

And same holds true for Hitachi Capital.

Now let me answer your third question, cash flow forecast. 2015 CCC is 71 days.

It's a big improvement. But we will go back once, slightly.

We have more capability, but IEP, the Europe railway project, sales will be in 2017 or 2018. It's a large-scale project, and so the inventory will accumulate.

And therefore, we will have a slight decline here. Of course, we will continue improving CCC, continue taking measures to improve CCC.

So the free cash flow total will be around JPY 100 billion. We will do investment, and there will be some increase in the working capital.

But we would like to secure around JPY 100 billion. Thank you very much.

I have 2 questions. First question is regarding the impact of business structure reforms, the total amount is JPY 35 billion.

Can you give us a breakdown of the segments? What is the breakdown by segment?

Second is a regular question. Regarding the corporate items and elimination, it says minus JPY 36 billion, but plus JPY 13 billion in terms of actuals.

What is your view on this? Please elaborate.

Now I would like to address the second question first. Regarding corporate items and eliminations, for 2016, the business environment continue to be opaque.

And out of the JPY 36 billion, we have looked at JPY 40 billion in terms of risk. And there are various structure reforms as well as reorganizations which will incur expenses.

And therefore, nonoperating versus JPY 20 billion risk is factored in. Our total EBIT basis is JPY 60 billion risk, and that is being factored in for corporate items and eliminations.

Now regarding the impact of restructuring reform, regarding the absolute amount of JPY 55 billion, it's 1/3 each. Information & Telecommunications Systems will account for 1/2 of the impact.

The remaining 1/2, 25% each is regarding infrastructure for Social Infrastructure & Industrial Systems and 25% for Construction Machinery as well as in metals listed companies.

Regarding the increase in profit for Information & Telecommunication System, is it -- can it be explained in its totality by the business structure reforms? I'm talking about the Information & Telecommunication System increase in profit for this term can [ph] be explained?

It's only JPY 1.6 billion, but the whole thing is business restructuring impact, is that the case?

There was increase in profit, which will go down. For example, system solutions is a good case in point.

Compared to products, profit margins are high, but system solutions revenue will be declining. For example, in 2014, 2015, there was a significant demand for the My Number system.

Social security and tax number system projects were quite prevalent. Gross margins were very high for these projects, and this will go away.

There will be an absence of this. And therefore, a decrease in revenue will lead to a decrease in earnings.

But overall, business structure reforms will be an area where we can harvest gains. With this, we'd like to offset the decline in profit so that we can increase both revenues and earnings.

Any other questions, please?

Regarding the South Africa project, you mentioned that you cannot talk about details, and I understand that. But in the press release, you said that you do not need to pay, that's what you mentioned, but even then, you are provisioning a certain amount.

So I would like to know the reason. And in your -- this year's guidance, have you included this provision?

Regarding South Africa, we have been negotiating with them for a while, and we said that we cannot meet their request. And so this negotiation is still underway.

However, in the end, there may be some part, amount that we have to borne -- bear. And so we anticipate a certain amount and provide a provision for that.

Now the forecast for 2016, we have not included this in fiscal year 2016 because by the end of 2015, we have already provisioned the result -- reserve based on our assumption. And so it is not included in the 2016 forecast.

This reserve amount, reserved amount, do you have an option to resolve this part first? Or is the minimum requirement to resolve the entire negotiation?

I'm sorry, I cannot talk about the detail. There are 12 units in this project.

It's a large-scale project. And so -- and it's about the project profitability of this large project.

So a total resolution or a partial resolution cannot be achieved easily, so we would like to sincerely continue with this negotiation.

I'm sorry to be repetitive, but the project's final timing, when do you think the project will be completed? And it's a little over JPY 300 billion.

You said that this is a minimum line. In other words, it may be bigger depending on the construction time period.

So if you could give us your forecast.

The completion period will be 3 to 4 years. So the same process as what MHI had said, so we share this process.

Now the amount that they have requested, saying it's minimum, but we think the reduction in the amount will be beneficial for both parties because it's our common profit. And so with MHPS, we'll manage the project solidly, which they are.

And so we do not think that this amount will increase significantly. MHPS project -- President Nishizawa is the professional project manager.

And so -- and he is doing a great job, so I trust him. On the other hand, South African labor environment is volatile, unstable.

And that is why the period has been extended to this much. And so I do not anticipate this to go up that significantly.

MHI, regarding MHI, there is nothing we can say in specific terms. What we can say is we will have the approval of the audit firms, and we are doing the accounting treatment thoroughly, and this is different from the negotiation.

And so we cannot make any comments on where Mitsubishi Heavy Industries is saying at the minimum amount or what other comments they're making because it's a different story.

Basically, I have 3 questions, both complex and easy. As already mentioned today for each of the main businesses, I would like to know what is the assumption for business environment for the fiscal year?

For example, in IT, the orders received, the trend, as well as some nice [ph] storage in the United States, how is it proceeding? Regarding the Information & Telecommunication Systems.

How are you looking at the outlook in terms of hardware and software? For Social Infrastructure & Industrial Systems in the Middle East, there were major projects last year.

But overall, what is the assumption for the business environment in terms of the Social Infrastructure & Industrial Systems, the elevator and escalators in China? It seems that for others, there are some improvements, but what is your outlook?

Now if you -- regarding Automotive Systems, in terms of the business environment, what is your assessment for Smart Life & Ecofriendly Systems as well? In terms of business environment, when you formulated these numbers, in April of next year, the consumption tax is likely to increase.

How is that factored in, in terms of these numbers for the major businesses? So please elaborate further in terms of the business environment you are assuming for these numbers.

Regarding business environment for Information & Telecommunication Systems, in the area of our systems solutions and platforms and products, we should separate for assessment. For 2014 and 2015, it was such that we had good demand in terms of the My Number system because -- as well as the financial systems.

There was strong performance because of the social security and tax number system. But this will only continue up until 2016.

But there will be a decline in terms of the My Number system as we have seen in 2015. But there should be some increase in FinTech as well as security systems supporting FinTech growing as well.

We believe that there will be more projects in this area. And therefore, in the domestic market, system solutions look very strong.

On the other hand, for products-related business, I believe that the environment will be more difficult. Service is a good case in point, and our large projects.

Market is undergoing change. So I believe that the business is going to be very difficult, which means that another round of business restructuring will be required, which has been started in 2015.

Now regarding the Social Infrastructure & Industrial Systems, for China elevators for 2015, in the beginning, we had significant backlog, therefore, it was not impacted. Market was already declining, but our numbers were not impacted because we had a backlog in 2015.

However, it is likely to decline in 2016 because of the absence of a backlog. In terms of the Automotive Systems, on the other hand, in the overseas market, profitability is improving.

Now however, in 2016, development expenses for driverless cars, they will be a negative impact on income. But we believe that the market is likely to be the same as 2015.

In other words, we believe that the market will be strong in 2016 as well. In Kumamoto, the earthquake has hit, and the impact is not 0.

But throughout the fiscal year, impact will be minimal according to our assessment.

What about the white goods as well as impact of the possible consumption tax, have you factored these in?

Regarding the impact of consumption tax, it has been factored in. But in terms of white goods, we believe that with the consumption tax, we can have an increase in revenues as well as earnings.

Whether it be automobiles or industry products, there is a surge in demand before the consumption tax. So for Automotive Systems, last-minute surge before the hike is factored in?

Regarding the Automotive Systems, we are not so cognizant. We are not so conscious about that.

Second question. Now in terms of increase/decrease analysis, the electricity charge as well as material costs, how is that factored in?

Because I'm sure there is a decline. And last year, the power companies had significant profit, therefore, it is likely to have an impact on first half?

In terms of material cost, this is also declining. How is this factored in?

This is my second question.

In terms of material cost, for materials, overall, the actual number for 2015 is an impact of JPY 10 billion. For 2016, the price decline impact or the cost-reduction impact is about JPY 20 billion for materials for 2016.

Crude oil related, on the other hand, with $1 change in the barrel cost, the impact will be JPY 800 million domestically per year. So it is difficult to quantify.

Currently, JPY 5 billion is the impact of crude oil according to our assumption.

What about the utility charge?

That is what I mean, utility charge. And we are also using some crude oil.

That is also included in this number.

What is -- I would like to confirm the balance sheet for this fiscal year. Manufacturing and services are separated, but the capital will go away.

So that means that manufacturing and services will be the only component we'll be looking at then, and then we have to subtract the Hitachi Transport System. Is this the correct understanding?

But Hitachi transportation systems, when it becomes equity-method affiliate, what is going to be the impact on the balance sheet?

No. The asset relationship is very complex.

So it's very difficult to answer your question. But what we can say is that for manufacturing and services, the Hitachi transportation systems was in a better position.

It's about JPY 700 billion or so in terms of sales, and the asset size is about JPY 500 billion, so it is more favorable. So in terms of asset turnover, it's about 0.99.

And because CCC has improved, it's about 1x. 0.93 or 0.94 is likely to be the number going forward.

So JPY 9 trillion revenue, and that means that a little bit less than JPY 10 trillion. And because of the Hitachi Capital and Hitachi Transportation Systems going away, that means that we'll have JPY 10 trillion in terms of asset, with JPY 9 trillion sales, which means it's about 25% or 26% in terms of equity ratio and the -- ratio, and we are assuming 30% going forward.

So one last question, please.

I have 2 questions. First is regarding Hitachi Capital that you announced today.

So Hitachi Capital, you're doing this for positive purposes, but you will still hold 33% of their shares. What is the significance of only 33%?

MUFJ Group, if it's a collaboration with MUFJ? And you may not need to have 33%, I think.

So why 33%, if you could give us the reasons, please? Why not 20% or 10%?

Hitachi Capital is for our Social Innovation Business. It plays a very important role for social infrastructure business.

The financial function cannot be sufficiently played only with Hitachi Capital and, therefore, we would like to reinforce this and utilize this more. So you said that maybe the shareholding can be even lower, but our operating companies -- this is the common financial platform that we would like to utilize as the group.

And so we want to secure the governance on this company. And therefore, we will send directors and do this solidly.

And that is why we are still the largest shareholder, so 33.4% will be maintained. That is why we led to this decision.

In mass media, President Higashihara said that he will consolidate the business that is less than 5%. But this may not be a good example for the group.

You will do more business restructuring this year. When will you continue -- until when will you continue this reform?

So your understanding on the low profitability and your forecast, please, regarding this 5%?

So 5% is the -- one of the guideline which we talk about internally. In fiscal year 2017 and onward are the -- ones that are less than 5% will be reviewed.

But a BU, not just a single BU or by segment, we will look in more detail by business and make decisions appropriately. That's what President Higashihara meant.

So we will, in brackets, we will see the low-profitability businesses and the ones that have low future, not viable. We may collaborate with other companies or wind down or exit or turn around.

So we will decide on what measures to take. So our direction is to do as much as possible by the end of fiscal year 2016.

But there are some businesses that will become obsolete over time. So may be things are okay now, but may be risky in the future or already becoming outdated or the market is changing.

So for those businesses, we will continuously do this. This activity is endless.

Despite the economic fluctuations, this is something we need to do no matter what.

With this, we would like to bring this meeting to a close. Thank you very much for your participation.