(Kamiwaki) In the 3Q, tapes and microparticle products in the Liquid Crystal field were affected by weak demand for large panels for TVs. In addition, semiconductor processing materials in the non-LCD field were also sluggish due to the delayed recovery in market conditions for semiconductors.

(Kamiwaki) Market conditions for semiconductors in the 4Q is expected to gradually recover, with demand for MLCCs also on a recovery trend. For products such as our bio-based tape and Selfa^®, in addition to a recovery in market conditions, we also expect to capture new demand and develop new business.

(Kamiwaki) Electric vehicle production in China was strong in the 3Q, creating more adoptions and shipments of interlayer films for HUDs than expected. Our October plan forecasts growth of over 115% for the 4Q and we expect to maintain this level.

(Kamiwaki) Along with interlayer films for HUDs, sales of heat insulation interlayer films mainly for electric vehicles has also been strong. High-performance products are driving overall sales, and we expect the same to continue in the 4Q.

(Okano) Although market share for our high-performance interlayer films is expected to remain strong, as a company we are focusing on higher-performance products, and we don’t believe that our overall market share will change significantly.

(Kamiwaki) For now, we haven’t experienced any significant impact. However, we do believe there will be risks going forward, for example, with increased distribution costs owing to the impact from the Suez Canal, which is why we are planning our operations fully aware of the situation.

(Kamiwaki) Due to the effects of a drop in demand for aircraft, it will be somewhat difficult for the company to move into the black in the 4Q. We therefore don’t expect SEKISUI AEROSPACE to be profitable until the next fiscal year. On the other hand, the rate of production of some models continues as planned, and non-aerospace fields such as drones and the Medical field are also growing, so we believe that the company is making steady progress toward becoming profitable.

(Kamiwaki) We will strengthen our meticulous rollout of products tailored to the characteristics and purchasing power of each area, for example, with one-story houses in rural areas and three-story houses in urban areas.

(Kamiwaki) In particular, we have started concentrating production at a few plants for wooden-framed homes, for which orders are decreasing. Optimization of the production system is progressing as planned.

(Kamiwaki) Although the soaring prices of steel and timber have come down, the prices of a wide range of other housing materials continue to rise. We will keep a close eye on the risks, including the risk of rising distribution costs due to Japan’s so-called ‘2024 problem’ (shortage of truck drivers).

(Kamiwaki) Yes. In urban areas, especially in the Tokyo metropolitan area, we are receiving orders for three-story homes and apartment buildings at higher-than-average unit prices.

(Kamiwaki) The impact on our business is limited. However, some of our customers’ homes, built by us, have been damaged, so we recognize that our immediate challenge is to provide follow-up support to these people.

(Kamiwaki) Public works projects in India are being put off ahead of the general election in fiscal 2024. This has caused a drop in demand but is seen as only temporary. Although there will be an impact as the CPVC Business is a relatively highly profitable business within the UIEP Business, we believe that any impact can be fully covered by other businesses within the company. As such, the outlook for the 2H is in line with the October plan.

(Kamiwaki) The launch of COVID-19 test kits in the U.S. had little effect in the 1H due to delays in FDA approval. Shipments began in August 2023 after approval was obtained, but a major distributor was hit by a cyberattack that disrupted delivery, putting a hold on sales promotion. The situation was resolved in the 3Q and the company is expected to resume sales in the 4Q.

(Kamiwaki) The average wage increase this fiscal year was slightly more than 4%. We have begun considering ways to maintain the same or higher level for the next fiscal year and beyond.