Good afternoon. The time has come, let us start the SCREEN Holdings Co., Ltd.

earnings call for the first quarter for the fiscal year ending in March 2027. Thank you very much for your participation despite your busy schedule.

I am the moderator for this opportunity, Nakamura, the Deputy Head of Investor Relations, Communication Strategy Division. Thank you very much for your kind cooperation to the end of the program.

Before the presentation, let me give you some housekeeping information. There was an earthquake in Kumamoto Prefecture, and we are now collecting information about the event.

There is a case that we have to end this presentation session earlier than scheduled. We'll give you the further notice when decision is made.

I ask for your kind understanding. This presentation is provided both in Japanese and English.

Simultaneous interpretation into English is available for the investors from abroad. Your camera and microphones are disabled.

We have the Q&A session after the presentation. When you confirm you are raising a hand with button, we will enable your microphone.

How to proceed Q&A session will be introduced to you later. When you make questions, please refrain from mentioning the specific name of the customer or competitors or the specific situation of the specific company.

This session is for the institutional investors and analysts. As was notified before, we will not entertain a question from the media.

Thank you for your kind understanding. The recorded data of the presentation and the Q&A session will be available on our website on July 29th, Wednesday.

Please find and use it. Now, let me introduce you today's presenters: Representative Director, President and Chief Executive Officer, Masato Goto.

I am Goto. Thank you for this opportunity.

Managing Executive Officer, Chief Financial Officer, Manabu Ishimura.

Thank you for this opportunity. I'm Ishimura.

Senior Executive Officer, Head of Communication Strategy, Chiho Otobe.

This is Otobe. Nice to talk to you.

Now,

let us invite CFO Ishimura to give you the consolidated business results and forecasts. Now, Mr.

Ishimura, the microphone is yours. Now,

I want to talk about the summary of FY 2027 March first quarter earnings and guidance for next fiscal year, the full year. This is the summary of consolidated earnings: the net sales is ¥121 billion, year on year, it's -10.3%, -¥14 billion year on year.

OP income is ¥14.3 billion, which is -41.1% year on year; it's -¥10 billion. OP margin is 11.8%, and it's -6.2% year on year.

All in all, sales and profits both decreased year on year. SPE sales and profits fell year on year.

However, this is within our expectation, there's no particular things happened. The slide projects are the memory project for China, and the revenue for this company will be posted in second quarter.

It's almost is going to happen as planned. GA sales and profits grew year on year; sales of recurring business increased.

For FT, sales and profits rose year on year; equipment sales for OLED and LCD increased. That was the situation in first quarter.

We have received record-high order, and full year forecasts was guided upward. The annual dividend plan was increased from ¥175 to ¥183, increased by ¥8.

Next is the first quarter consolidated earnings in detail. For net sales, as I explained, it's ¥121.7 billion, which is -¥14 [billion?]

quarter on quarter. OP income is ¥14.3 billion, and ordinary income is ¥15.4 billion, a -¥9.1 billion.

Net income is ¥10.4 [billion?] , and it's -¥6.1 [billion?]

Q-on-Q. This is the sales by destination.

The China portion was 41% in fourth quarter and now decreased to 27% in first quarter. On the other hand, the EU increased from 8% to 16%, by 8%.

Taiwan increased from 19% to 23%, increased by 4%. Korea also increased.

Next is the sales by segment. SPE actually was a bit low, 76.5% is from SPE, which is slightly less than 80%, and other business basically no change.

This is the consolidated earnings by segment in first quarter. SPE, the sales and profit both fell: it's ¥93 billion, and OP was ¥14.3 billion, and the OP margin was 15.4%.

It's both sales and profits fell, and the sales decreased by -¥16 [billion?] , and OP decreased by -¥11 [billion?]

. The China, Taiwan declined, and the sales for foundry and logic decreased.

Sales from a delayed project to be posted in second quarter, as I have explained earlier. For GA, the sales of the first quarter is ¥13.8 [billion?]

, and OP income is ¥1.4 [billion?] , and OP margin was 10.3%.

The revenue increased by ¥0.9 billion, and OP income increased by ¥0.8 [billion?] .

For GA, sales and profits both grew, and it's driven by recurring business. For FT, sales was ¥10.8 [billion?]

, and OP income is ¥1.2 [billion?] ; OP margin was 11.8%.

It's 0.8%, sorry, ¥0.8 billion increase, and ¥0.4 billion increase in OP. PE was ¥3.1 [billion?]

, and OP income was -¥0.2 [billion?] .

Sales slightly increased. However, due to fixed cost increase, the profit fell.

This is the balance sheet in consolidated. Net assets reached ¥497.3 billion, and equity ratio is now at 60.

4.6% [sic]. We believe equity ratio is in appropriate range.

Next, please. This is the consolidated cash flow.

The first quarter was ¥9 billion. Due to the income tax payment, we had this number, ¥9.0 billion.

For investment cash flow is -¥10 [billion?] , and total free cash flow is -¥0.9 billion.

Financing cash flow is -¥16.2 billion; this is due to the dividend payment. Next is R&D and CapEx and depreciation or amortization.

R&D is ¥10.1 [billion?] .

We had almost expected landing. CapEx were ¥17.8 billion in first quarter.

From the trend of past, it seems to be high, but this is due to ATCA in New York. For rental equipment, we had to post all the rental cost in this term.

If we exclude, everything is ordinary, and the depreciation is ¥4.0 billion. Full year forecast hasn't been changed from last time.

R&D or IT or production, those are the investment target, but looking at the order, we have to be ready for the increased capacity for the production. Next is the analysis of operating income growth.

Compared to the first quarter last year, it's decreased from ¥24 [billion?] to ¥14 [billion?]

. The major factor is the SPE.

Sales declined in SPE, and also utilization has impacted. Profitability improved mainly due to FT, +¥2.5 [billion?]

. For fixed cost, mainly in SPE, we had growth investment, -¥3.5 [billion?]

. Exchange rate mainly impacted GA, +¥1.0 [billion?]

. Profitability and exchange rate had +¥2.5 [billion?]

and +¥1.0 [billion?] , and that will be canceled by this fixed cost decrease.

Next is the business forecast for full year of FY 2027. For first half, we haven't changed as a company total.

The net sales is ¥317 [billion?] , and OP is ¥56 [billion?]

, and OP margin is 17.7%, and ordinary income will be ¥56 billion. GA, FT, PE, there was some correction made.

However, in the consolidated, we don't have any major change. To the right is the full year forecast.

This time, the net sales is ¥743 [billion?] .

We have increased from ¥725 [billion?] in May forecast.

OP is ¥156.5 [billion?] .

Again, we have made some increase from ¥150 billion. Ordinary income similarly increased to ¥156.5 [billion?]

. Net income is ¥115 [billion?]

. We have made some increase from ¥110 [billion?]

in May forecast. If we look into segments, SPE, the sales is ¥620 [billion?]

, increased by ¥20 [billion?] from May forecast.

Accordingly, OP income will be increased to ¥159 [billion?] from ¥153 [billion?]

, and OP margin will be 25.6%. For GA, the sales and OP both increased by ¥1 billion from May forecast.

FT, we expected ¥47 [billion?] in May forecast, but the sales of advanced packaging was examined this time, now we are estimating ¥43 billion.

For PE, the sales is going to increase by ¥1 billion from May forecast. Next is the operating income growth forecast.

Last year was ¥122 billion, and our estimate now is ¥156 [billion?] .

Breakdown is the sales and capacity utilization has an impact of +¥74.5 [billion?] .

Compared to last time, we have increased it ¥3 billion. Profitability in SPE, the product mix will change, we are estimating -¥8.5 [billion?]

. For fixed cost is -¥31.5 [billion?]

, and exchange rate is -¥0.5 billion. Together with the sales increase, we are estimating profit increase.

That's the major trend in this fiscal year. The dividend outlook: interim forecast was not changed, ¥60, but for the year-end is ¥115 in the May forecast, but now we are announcing ¥123, total will be increased from ¥175 to ¥183.

This is going to be record-high dividend for us. This concludes my part.

Thank you very much.

Thank you, CFO Mr. Ishimura.

Now let us invite President Goto to give us a business environment and outlook.

This is Goto. Let me give you presentation about business environment and outlook.

About the full year outlook overview: as was explained by Ishimura a moment ago, full year forecast was raised, or we made upward revision. Because mainly with the AI investment, we witnessed a very strong demand from the market.

The record-high level of the inquiry and order have been witnessed. In the second half, we can turn them into the sales, so that's why we made upward revision for the second half forecast.

Given this situation, we have to catch this demand and opportunity to achieve the further growth. In previous fiscal year, we opened the ATCA in United States as an research and development hub.

In Hikone, we enhanced the production capacity. With these, we'd like to deal with the increasing demand.

About SPE, we will capture the strong investment in leading-edge foundry, logic, and memory. The situation is getting better, we will surely capture this demand and we will outperform WFE market growth.

That's what we will surely achieve. Under the current mid-term management plan, we made the investment, and for these investment or for these projects, we'll carry them out and harvest the results.

In that sense, the ATCA evaluation process will be established and launched. Preparing ourselves against the further growth in the market, we will increase the production capacity of SPE.

We have the plan for them, we'd like to prepare ourselves against the upcoming opportunities. We have made preparation for the enhancement of the competitiveness of the products and also the production capacity.

Through these, we'd like to capture the opportunities in expanding market. Next page, please.

This is the situation in a market. As I mentioned a moment ago, for the whole WFE, in calendar year 2026, we expect about 20% growth.

In the same way, in calendar year 2027, we expect the similar level of growth. The balance between the two years may change because of the situation, but the coming two years would be that one we'll see a very steady market growth.

As including the Middle East situations, there are geopolitical situations which might seem settled down a little bit, but again, the uncertainty is rising. We'll continue to pay the close attention to the geopolitical situation so that we can be flexible enough to take the appropriate measures when things happen.

Investment trends by application: as you can find here, foundry, AI-driven leading-edge investments to be the primary driver of WFE growth. Logic: the large-scale project launches is a background for the recovery.

In addition to that, we have the support by the ASIC demand. Logic-related strong demand is expected from now.

Next is memory. As DRAM and HBM, the advanced products, is in shortage now.

The CapEx into DRAM will drive the recovery in the memory market. Not only the advanced HBM, but the existing DDR is also in shortage.

In addition to the HBM, the general type DDR will also receive the CapEx. From two years to come, we can expect a very strong investment into memory in general.

The same situation can be expected with NAND. There is a recovery in investment into data center.

The domestic and overseas NAND manufacturers are now planning investment. Memory, both for the DRAM and NAND, we can expect very strong demand.

Next is the image devices. It was sluggish, but now we see the recovery in the situation.

Japanese major auto manufacturers now started to increase the production. As for the image devices, we can expect the growth from now.

Power devices and others: compared to the other types of devices, the process was rather slow, but finally, we see the sign of recovery in investment. In that sense, compared to the other advanced devices, the start is a rather kind of slow, but by dealing with the situation, we'd like to capture the demand from the market.

Next is advanced packaging. WLP applications to lead initially, followed by the growth in PLP applications.

Our key areas of advanced package should be dealt without fault. China market: similar to the other device manufacturers, not only among the existing foundry and memory clients, investments are becoming active especially among the emerging and foreign-affiliated clients.

Globally the market from 2026 to 2027, we can expect the big growth in the SPE business. Next page, please.

This is the composition of equipment sales by application for SPE. As you can see here, this is the result of the first quarter.

About half is coming from foundry, and we have the strong DRAM, and this is the current situation. Q-on-Q basis and also on the YoY basis, we can see the sales increase of DRAM, which is very clear trend in application sales.

Next page, please. This is the post-sales.

About post-sales, the higher fab utilization rate by the customers as a background, we can see the stronger demand for the replacement and consumable parts and units. This is an area of business we can expect the further growth.

In addition to the sales of the new equipment, we will have the lineup of the consumable parts and units for the replacement and post-sales. Next page, please.

This is the SPE composition of sales by destination. As you see here, Taiwan and China accounts for almost half.

In addition to that, Japan, North America, and Europe follow. When you see the overall situation in the first quarter on a Q-on-Q basis, sales to North America rose, and Taiwan remained solid.

On YoY basis, we saw the increase of sales to North America. This is a situation from the first quarter.

This is the composition of sales by application. The foundry has a large portion, followed by DRAM, and this situation will continue.

The proportion will continue in this way. This situation is not limited to the first quarter, but we expect the same situation into the second half of the fiscal year.

Next page, please. This is the post-sales for the SPE forecast.

As I mentioned earlier, in order to secure the profitability and in order to follow or maintain the equipment we sold, we'd like to follow this post-sales. For the first time in this fiscal year, the post-sales will exceed the ¥100 billion, and we'll further enhance this field of business to ensure the profitability.

In addition to new businesses, this is another key business we have. Next is the SPE's composition of sales by destination forecast.

As I mentioned earlier, as for the situation, we do not expect any big change. Taiwan and China, these two regions will continue to achieve the big growth, followed by North America and Europe.

As you see here, in the second quarter compared to the first quarter, top line will grow, but the proportion by destination will not change so much. China and Taiwan, their ranks are reversed, but this may change quarter by quarter, but the situation will not change.

China and Taiwan will continue to lead the positions. Next page, please.

This is a GA sales trends and a forecast. As we have been explaining to you, we want to increase the recurring business in addition to the sales of the equipment so that we can secure or improve profitability.

In GA business, we newly released the roll-fed digital printing process, which had received strong inquiry in North America, we'd like to grow this business. In Japan, the so-called CTP offset printing equipment has a strong demand, but also in Japan, we'd like to promote this new digital printing process.

Next page, please. Next is the sales trend and forecast, led by the OLED, we are promoting the sales so that we can secure the stable profits.

From this fiscal year, we integrated the advanced packaging business into the FT. In that sense, in addition to the display business, we can have the synergy with advanced packaging business so that we can secure the sales and profit.

Next is PE sales trend and forecast. We struggled in this business, but finally the market has recovered.

Investment into memory and inquiry from the packaging business has increased. Finally, as for the PE segment, from the second half of this fiscal year, we can expect a full-fledged recovery of the market.

We'll capture the opportunities in this market so that we can achieve the sales and profit secured for the PE business. Next page, please.

These are about the recent SCREEN Group news. They were already released, I think some of you already know about these.

There are two news about SPE and one news release about GA. One of them is this news: SCREEN joins Applied Materials' EPIC Center as innovation partner.

This center will be newly launched as in California. Through various research developments have been done together with Applied Materials, and through this partnership, we can enhance or deepen our relationship with them.

We'd like to be involved in this launch of this new EPIC Center. Next is related to GA, about the Chiyoda Gravure.

We collaborate on promoting digital printing on flexible packaging, and we'll move on to the full-scale production. Chiyoda Gravure has the market, and into which we provide the flexible packaging.

From the conventional paper-based packaging, we move on to the film-based packaging. We'll take this opportunity to provide the flexible packaging into that market in addition to the conventional printing equipment.

Let me give the microphone to Otobe-san to explain the next page.

This is Otobe. As usual, we have the small group meetings after today's earnings call.

We host the small group meetings to follow up this earnings call today. We have the Japanese version one in the morning of September 2nd, and English version one in the morning of September 8th.

For the investors in United States, I'm sorry for this time frame, but we'd like to give you the opportunities to follow up us at the conferences and other opportunities, and I ask for your kind participation to these events. Please go to page 17.

Goto-san talked about the WFE outlook. There was a announcement we expect about 20% growth in calendar year 2026, and let me give you the breakdown about this part because I think you may ask questions on this point.

From the forecast in May, we made a update. First one is that in advanced logic foundry, it's a bit less than 25% was the comment we made, and we changed it to over 20%.

Next is memory, especially about DRAM: it's a bit less than 25% was the comment we made, and through the revision, we changed it to the over 25%. Next, about NAND: previously, we said it is little bit less than 15%, and we made the upward revision to about 20%.

The power devices and others, no much difference, but it's been about a little bit less than 10%. This time, in this we changed the slides related to SPE, especially about the one by application.

Far, we had application plus alpha, and we had post-sales. We have the page for the application, we separated application and post-sales.

As was explained by Goto a moment ago, we have the page for sales by application and post-sales separately. You can find the appendix to show you on page 32 and page 33 to show you the composition of sales by application and for both equipment and post-sales.

Thank you very much, Mr. Goto and Ms.

Otobe. We'd like to go into Q&A session.

Because the time is limited, I'd like you to ask questions, two questions per a person, and I want to ask for your kind cooperation in time management. Please use the raise hand button on Teams to ask questions.

When your name is called, please unmute yourself and ask your question. Now, Yoshida-san from CLSA, would you please?

Thank you very much. I am Yoshida from CLSA.

SPE sales is going to expand towards second half. Lead time for equipment is how long, and how much visibility you have in the order taking?

Maybe if you break down into third quarter and fourth quarter, can you please tell us the breakdown of the second half?

Goto is going to address this question.

The lead time for equipment, of course, differs depending on the type or model, but currently maybe 4.2 months in on average, 4 or 4 to 5 months on average. Order visibility: so the order for the sales of this fiscal year is almost fixed, and based on that, we are making upward revision.

For the sales of this fiscal year is almost visible. The breakdown between third quarter and fourth quarter, like fourth quarter is higher than third quarter.

The sales is going to be flat. Looking at customer demand, as you may know already, the memory, they have to increase production.

Memory device maker makers are asking the delivery accelerated. Probably the demand is now stronger than our capacity right now.

Thank you very much. My second question is WFE market is probably same level of growth in next fiscal year from this fiscal year.

There was application update in this fiscal year, but towards next year, do you see any different trend in any application? If you have any comment by application, would you please?

The outlook for next year is almost no change in the trend from this fiscal year. As you may know, the DRAM and memory device makers are going to be very aggressive in investment from the second half to next fiscal year.

Their CapEx or production plan, looking at that, probably early next year to second half of next year. Centering around memory, we have seen strong order, and also latest logic foundry will be similar to this year level.

There will be no major change in the trend.

How about logic? Maybe some customers are changing in their tone.

Do you have any upside?

As you may know, some customer makes announcement, logic customer as well making some announcement in strategy, and we are seeing some inquiry, but it's not fixed yet. Individual device maker the situation, there's not much we can share with you right now.

As soon as we see any concrete business, we will want to disclose to you.

Thank you very much.

Thank you very much, Yoshida-san. Next, let me invite Mr.

Shibano from Citigroup Securities.

This is Shibano from Group Securities. The first question is that how should we think about your capacity?

You explained both for the FY 2026 and 2027 or for calendar year, expect the 20% growth. When I make the simple calculation, in '27, ¥70 [billion?]

or ¥80 billion is expected. If the demand grows further and in 2027, if it reaches ¥20 billion or ¥25 billion in 2028 or maybe close to ¥30 billion demand exist, as SCREEN Holdings or the supply chain of SCREEN Holdings, is it possible to respond to such scale of demand?

This is my first question.

About the capacity, in this fiscal year and next fiscal year, we already have the capacity to cover the demand coming in the two years from now. If this market situation changes further and if the further increase of the capacity is requested, we, in order to prepare ourselves, we have equipments in Nagaoka in Kyoto, and we are now remodeling them so that we can increase our capacity.

That has started in this fiscal year and will be complete in the beginning of next fiscal year. This is where we can see the expected increase of production capacity.

Also in Hikone, we have the existing capacity, and we are already going through the measures to enhance their capacities. If the demand goes up to ¥30 billion in a short period of time, we have to solve the issues of the supply chain and others, it may be difficult to jump to that level.

When we think about the realistic situations, when we think about the suppliers of equipment and others or the materials, I think even if there's any further increased demand, I think we are well prepared so that we'll not be behind the other suppliers.

Example, when WFE 2027 and 2028, do you see any visibility about how much capacity you can increase or?

As was mentioned by Otobe-san a moment ago or as I explained to you, WFE grows. We are going to outperform the growth of the WFE market itself.

That means that we are going to have the capacity to achieve that. How much we can achieve is hard to be described, but as I mentioned a moment ago, not only by ourselves, but you also have to look into the supply capacity of other suppliers, and I have the confidence that we can cover the demand.

We are now establishing the next mid-term management plan. Including this point, we'd like to make another announcement when we are ready.

As for the currently expected market growth for this fiscal year and next fiscal year and plus alpha can be covered by our current capacity.

Thank you very much. My next question is about the first quarter semi sales was a little bit slow, and how do you expect the situation in the July to September period?

I think you expect the recovery. As it includes the delayed project and also the increasing shipment from the April to June period, and how about the probability of this delayed project you mentioned?

The probability of recording the sales for that delayed project is 80% to 90%? In July to September period, you are going to record high sales, and how much of the sales was already shipped?

About the delayed project, we have the very high probability, the final stage of the confirmation by the auditor is waiting, probability is higher than 90%. About July to September period, how much of the shipment was made against the expected sales, I think about half of the expected sales is already shipped.

Already half of the expected sales was shipped, and about the remaining half, in order to record the sales by the end of September, so that means by the first week of September, we will complete the shipment.

You said that about half is already shipped, this is not the end of the June, but as of now, you shipped about half?

Yes, as of today, almost half of the sales was already shipped.

Thank you very much. It's clear.

Thank you very much, Shibano-san. Then Nakamura-san from Morgan Stanley, would you please?

Thank you very much. I am Nakamura from Morgan Stanley.

Full year guidance, I wanted to ask about full year guidance. The third quarter and fourth quarter, when somebody asked earlier, maybe it's going to exceed the capacity of fourth quarter.

For monthly revenue in SPE, if there's some more upside, do you think that we should believe that you can achieve? Also in the last presentation, we have some discussion.

You're going to increase sales in this fiscal year, profit has to increase, we believe. Again, I want to ask your take on the profit for this fiscal year.

The third quarter and fourth quarter, the further sales increase, if there may be or not?

As we have received in the first question, the revenue for this fiscal year, we have almost made production plan, there's no more room that we can change drastically. However, if there's slight upside, we could still take it.

In that sense, the possibility is not zero. However, as I said earlier, there's no drastic increase like 30% or 20% going forward.

That's very difficult. Also for profit, as I explained earlier, the capacity has to be prepared.

Out of our profit, maybe some percentage has to be used for investment for next phase. The increase of profitability and also growth investment, we need to look at together in making plan.

That's why we are making this kind of plan. So...

In the fixed cost increase in the plan, as you have explained in the last presentation, are you seeing even more upside or not?

No, for fixed cost, it's no change.

Sorry, some investor is not muted. Would you please mute yourself if you're not giving question?

Another question is the equipment makers are now increasing prices. You are in a very favorable position to increase prices, I believe.

Not maybe price increase, but you have a very better position in negotiating, or are you taking the lead in the price negotiation, or do you have any plan?

Yes, we're not making negotiation because we are in strong position, but we are now improving performance of the equipment, and those are evaluated and those are reflected in the price. In addition, recently there are many geopolitical risk, and raw material cost is increasing.

For this increase, we are making our corporate effort. However, at the same time, we are reflecting those raw material price to the equipment price.

It's not like we are in the strong position, we are increasing prices, but our performance of equipment is improving, and also the raw material price is increasing. That's why we need to ask customer to reflect into the prices.

The situation in last year or compared to the past, do you think it is easier to pass on to the price, or additional value can be reflected in the price more easily?

Yes, for additional value, yeah, we are asking day-to-day basis to customer to understand, and as long as customer understand, that it's reflected into the price. For raw material increase, it's not only affecting us, but entire market.

Customer understands because their raw material is increasing. They fully understand that we need to share these kind of situation or environment.

We will continue this effort and negotiation with customer, and for cost increase, we want to share with customer.

Thank you. Understood very well.

Thank you.

Thank you,

Nakamura-san. Next, let me invite Mr.

Shimamoto from Okasan Securities.

This is Shimamoto from Okasan Securities. I have two questions.

First one is about WFE. I want to confirm some figures you gave us.

Foundry, you changed the figure from the less than 25% to 20%. Is this a decline or increase?

How do we understand this change? We raised the figures.

Previously, it was between 15% to 20%, and we had assumption on the case of the 15% or 20%. A little bit less than 25% is assumption when we have the 20%, it depends on how much increase we can expect, but anyhow, this is an increase of the figure.

We look into the situation of the investment by the customers, we came up with this assumption or expectation. Thank you very much.

Second question is about WFE in China. Would you give us how you see the situation?

I think there are some differences in expressions used. About situation in China, as the AI-related new solutions or new AI are released.

When they have such products released, they need infrastructure for the operation of the AI. That means it needs the high-functional devices and data centers, and they have to make investment into these.

That is a field where we have the competitive edge and strength. The situation hasn't changed so much from the past.

WFE in China is growing. Of course, there are the Chinese local manufacturers for the general-type products.

As I mentioned a moment ago, these is growing, not only for the general-type ones, but especially for the advanced-type ones. This situation is same in China, and that trend is favorable for us.

That is a situation we find in China at WFE.

Previously you said that you expect a flattish situation in China. You haven't changed it?

China is growing. Please understand in this way.

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

Thank you, Shimamoto-san. Nakamura-san from Goldman Sachs, please.

Thank you very much. Can you hear my voice?

Yes. Yes, please.

The sales and profit of first quarter is as per you planned, that's what you said. In semiconductor segment, sales and profit dropped so sharp.

Can we explain only from the sales drop or not? Can you explain again?

Yes, the sales goes so much down, profit has to come down. This is solely due to the sales drop.

There's no other particular reason. No other particular reason other than sales drop.

Annually, you're planning the fixed cost. Are you consuming as planned from the first quarter?

Slightly increase is less, but almost as per plan.

Thank you. The semiconductor in second quarter, how do you look at the profitability?

You said second half is almost full capacity and for sales. In that situation, the profit ratio that you can consider from your product mix, if there's any change in product mix, would you please share with us?

Any one-time event we are not expecting. We have this volume of the project, and product mix that we are assuming will be a good to make this kind of profitability.

There's no any special factor.

Thank you very much.

Nakamura-san, thank you very much. Next, let me invite Mr.

Yoshioka from Nomura Securities.

Thank you for this opportunity. This is Yoshioka from Nomura Securities.

Can you hear me? Yes.

I have two simple questions, including confirmation. First one is that the sales of the post-sales.

On page 19 and on page 22, you explained the post-sales. On page 22, in the second half against the first half, there's a decline of the post-sales.

Reported the basis, the sales is about ¥26 billion. From the second half of the previous fiscal year, I think there's no big change in this figure.

My question is that, in the second half post-sales, do you have a kind of conservative view, or you expect the increase of the utilization and the shortage of the clean room, there's a kind of quick growth of the post-sales first, expect a kind of decline in the second half? How do you see or interpret this post-sales in the second half?

About the post-sales itself, we have the maintenance or warranty period for them. Two years after the sales of the equipment, we can expect the growth of the post-sales.

For this fiscal year post-sales coming from the sales of the equipment two years ago, this is a background we have about the growth of performance of post-sales. When there's any change in the situation in the market in this fiscal year, that may have some impact on the consumable sales.

As for the major trend of the post-sales, as we see in this fiscal year, when we have the big sales of the equipment in the second half, the proportion of the post-sales may decline. We have the plan for the growth of the post-sales based on the actual well-established plan, there's no special factor for that.

As for the improvement of the performance upgrade, the utilization ratio is quite high at this moment at customer side, it is difficult to stop it to give the upgrading of the equipment. This is a kind of situation we now face.

We'd like to cover this situation up with the offering of the consumables. Given these situations, we come up with the plan.

Understood. Thank you very much.

My second question is about confirmation of some figures. I'm looking at the page 12, and operating profit, Others and Adjustment column.

In Q1, it is -¥2.4 billion. If it is like this, in the second quarter, you expect about ¥6 billion or more of the minus figures.

Would you explain this a big figure for the adjustment and others in the second quarter? I think there's a kind of buffer from the operating profit from the first quarter.

Would you explain this figure for the second quarter?

This is just adjustment, it includes a kind of buffer. A consolidated adjustment is also included.

There will be no big change.

Understood. This figure is because of the buffer.

Understood. Thank you very much.

Closing time is coming soon. We would like to have the final question from SBII Securities.

I have a question about China. It's going to explode, that's what all we see here.

They're trying to get the equipment as soon as possible, and they're fiercely competing over that.

What's the situation? As you have mentioned, the China situation, they have to be prepared the AI-related infrastructure, cutting-edge devices in strong demand.

We are seeing a lot of inquiry in China.

As I said earlier, the cutting-edge device, we are very strong. We are receiving so many inquiries, not only from China, but also from different regions.

Market situation, it's maybe record high the inquiry we are receiving. Going forward, it's going to continue for a while.

The ratio of China, we get questions often. Originally, it will be maybe around 30%.

That was our forecast. The manufacturing plan or inquiry will make some effect, but the basic situation is not going to change so drastic.

Next one is about PLP. How much in this fiscal year and next fiscal year, can you share the outlook for PLP?

The concrete number in PLP is very difficult to share at this moment. Next fiscal year, as mass production is not happening yet, but evaluation phase is starting.

Compared to this fiscal year, probably it's going to be double. That's the market forecast.

We don't have concrete number, and at the end of this fiscal year, we hope we can share some number. Double of that will be maybe coming to next fiscal year.

This is our assumption.

Thank you very much.

Thank you, Wada-san.

We apologize, but due to time, we'd like to conclude this meeting. This concludes the first quarter presentation of SCREEN Holdings.

Thank you very much for your time, and thank you very much for your participation. Thank you very much.