The sales for the second quarter of the term ending March 2020 were 62.6 billion yen, down 35.9% year-on-year. The sales of the Chemicals & Energy Plant segment decreased dramatically due to the recoil from the delivery of a newly constructed power plant during the same period of the previous year. Operating income was 860 million yen, unchanged from the same period of the previous year. In addition to the effective marketing activities, the robust performance of subsidiaries contributed to these results. Sales were below the estimates, but, thanks to the subsidiaries’ contribution, profit exceeded the estimate.

The full-year earnings forecast is unchanged. The sales for the term ending March 2020 are estimated to be 135 billion yen, down 14.1% year-on-year. The decrease in sales for the Power Plant and Chemicals & Energy Plant segments can’t be covered. Operating income is estimated to increase 13.3% year-on-year to 2.4 billion yen. Profit will see a double-digit increase thanks to the contribution of subsidiaries. The dividend is estimated to remain unchanged at 45 yen/share. The estimated payout ratio is 34.5%.

This term is the final fiscal year of the “Mid-term Management Plan CS2020,” which is to be the first step for the long-term management vision, but the net income is not expected to reach its goal. As the company is going to discuss the next mid-term management plan, which is set to start in April 2020, it will re-evaluate the business environment around each business segment, identify issues, and develop a more practical plan. Moreover, we will pay attention to how far the company can get closer to its goals during the second half in order to smoothly proceed to the next mid-term management plan, which is going to be the second step for the long-term management vision.

On the other hand, we are also paying attention to the development of environment-friendly products. As demand grows, it is naturally expected that competition will become fiercer, and our attention is attracted to how the company is going to reinforce its competitiveness and generate a larger volume of sales.