In terms of manufacturing costs, at the start of the fiscal year ended March 31, 2013 as part of production restructuring measures in China, we integrated three sites into two and positioned the state-of-the-art Wuxi Plant as a production base for a new product series and commenced production. Nonetheless, we need to boost capabilities in the assembly of new platform products that are different from before, and production profit and loss deteriorated, mainly in the first half of the fiscal year. Although we succeeded with measures to cut manufacturing expenses while fixed costs started to improve in the second half, we were unable to achieve plans for variable costs.

Selling, general and administrative expenses (SG&A) increased by ¥12.2 billion. Of this amount, ¥8.2 billion was accounted for by M&As to bolster IT and service capabilities as the Company implemented a variety of measures to strengthen structure aimed at transforming the business portfolio.