Good day, everyone, and welcome to the conference call of Takeda Pharmaceutical Company Limited. [Operator Instructions]. Now we start the conference. Mr. Okubo, please go ahead..

Thank you very much for coming to join in FY 2020 Q1 earnings announcement. I'd like to serve us a facilitator today of Global IR Head. In this conference call, Private Securities Litigation Reform Act of 1995, the forward-looking statement and related informations will be discussed.

And the results of discussions may differ substantially from the actual results. And the latest Form 20-F and other SEC-submitted documents describe all those potential factors. And in Page 2 of today's presentations, there are important notice discussed. Please also refer to that page. And we have presenters and the responders to your questions.

We have Christophe Weber, President and CEO; Chief Financial Officer, Costa Saroukos; Avanti President, Andrew Plump; and Japan Pharma Business Unit President, Masato Iwasaki; and PDT Business Unit President, Julie Kim. They are participating on this earnings call.

First, CEO, Christophe, will discuss the overview of the results, and then Andrew will cover R&D situations, and followed by Costa, CFO, covering the financial aspects. After those presentations, we will have questions and answers. So please be prepared with the presentation materials.

Christophe?.

keeping our employees safe, and we have been extremely successful at that; maintaining our business continuity, and we didn't see any supply disruption because of the coronavirus, which is great; our clinical trial are resuming as well for those who were on the slowdown path. So I think we are starting to see a return to normal in many areas.

And we are committed to develop potential therapies with our hyperimmune globulin development first, but also at looking at potential product in our pipeline which could have some efficacy against the coronavirus. I will finish the introduction with the next slide to update you on the Hikari situation.

First, I will insist on the fact that quality has always been a priority for Takeda. So we have a very strong expertise and background in quality. And so we know how to resolve this situation. We have a very clear path to resolve the -- and to remediate the situation in Hikari.

So we have submitted our reply to the FDA, and we are working very intensively to remediate the situation as quickly as possible. At the same times, we really are aiming to limit -- reduce the potential impact, the potential shortage for patients.

We were able to resume, to restart production of leuprorelin for the Japanese market, and also other countries, in -- on July 20. So that's very important because it will very much limit the potential shortage, and we'll be able to resupply the product in September.

At the same times, we gave some guidance to the doctors in Japan to manage as well as possible their patients. So I apologize to the doctor, to the patient about the inconvenience, but I think we are doing really our best to limit that impact. We don't believe that there will be a global shortage of leuprorelin.

There might be periodic shortage in Japan, potentially in the U.S. But we don't believe that it will have -- financially, it won't have a material impact on the company as a whole. So I think that it's more good news in term of managing the situation and the capability of resupplying leuprorelin.

Thank you, and I will pass now to Andy for the R&D presentation..

our STING agonist; our oncolytic virus and then our GPC3 CAR-T, all have approved INDs, and we expect to be dosing patients shortly. Next slide, please. So before I hand it over to Costa, I'll just end by mentioning that in addition to the progress that we're making with our pipeline, we're also making progress on our support for our global brands.

So with that said, Costa, I'll hand it over to you..

Hello, everyone. This is got Costa Saroukos speaking. Could you please turn to Slide 18 of the presentation? As Christophe highlighted in his first slide, we're off to a strong start, confirming the resilience of our portfolio.

Our strong quarter 1 and cash flow reinforce our confidence in our ability to meet our fiscal 2020 and medium-term financial targets. Underlying revenue growth in quarter 1 was approximately 1%, consistent with our full year guidance of low single-digit growth.

This growth was driven by our 14 global brands, which more than offset headwinds such as ULORIC loss of exclusivity and NATPARA recall. Underlying core operating profit margin was very strong at 34.7%, benefiting from OpEx efficiencies and synergies as well as some lower spending due to COVID-19.

As with prior years, quarter 1 tends to be our strongest quarter for margins, and this great start puts us well on track towards a full year target of low 30s. Free cash flow for quarter 1 was also robust at ¥146.3 billion, including proceeds from the sale of marketable securities.

We are progressing well with unlocking incremental cash from the balance sheet, and I'll discuss this later in the presentation. We also continue to make excellent progress with divestitures. And since quarter 4 earnings, we have announced an additional deal to divest select noncore and OTC products in Asia Pacific region.

This takes the total of our announced divestitures to up to USD 8 billion. With our robust cash flow and earnings growth, we continue to make steady progress with deleveraging. As of June 2020, our net debt to adjusted EBITDA ratio was 3.7x, improved from 3.8x in March.

This is even after paying the half year dividend of ¥133.1 billion, equivalent to approximately USD 1.2 billion. In summary, I'm very pleased with our performance in the first quarter as we continue to execute towards our financial targets.

We remain committed to driving revenue growth that will accelerate in the medium term, achieving top-tier margins and completing our divestiture program of USD 10 billion as we target 2x net debt to adjusted EBITDA within the fiscal year 2021 to 2023. On Slide 19, this is a summary of our fiscal year quarter 1 results.

You'll see that the reported revenue was ¥801.9 billion, down 5.6% versus the prior year, mainly due to foreign exchange impact and also the effect of divestitures. Underlying revenue growth, which adjusts for foreign exchange and divestitures, was increasing by 0.9%, driven by our 14 global brands.

This growth is despite headwinds in quarter 1 from the loss of exclusivity of ULORIC and the NATPARA recall, which occurred in July and September of last year, respectively. Reported operating profit was ¥167.3 billion, a significant improvement of 270% versus prior year.

This was due to lower purchase accounting and integration expenses related to the Shire acquisition and also reflects a one-time gain related to SHP647. As a result, our reported operating profit margin reached 20.9%, over 15 percentage points higher than last year.

Core operating profit, which adjusts for purchase accounting and nonrecurring items, was ¥280.9 billion. This was a slight decline from prior year due to foreign exchange impact and divestitures. If we adjust for foreign exchange divestitures, underlying core operating profit grew at an impressive 11.2%.

Our core and underlying core operating profit margins were also very strong, both approximately 35%. Reported EPS was ¥53, and core EPS was ¥122. Underlying core EPS growth was 8.7%. And finally, cash flow for the quarter was very strong with operating cash flow and free cash flow both around ¥145 billion and growing well versus prior year.

Slide 20 gives you more insight into the magnitude of the foreign exchange and divestiture impact on our quarter 1 results and COVID operating profit. As you can see, appreciation of the yen had a negative impact of 4.4 percentage points on revenue.

The impact of divestitures was 2.1 percentage points, mainly due to Xiidra, which was divested at the start of quarter 2 last year. On Slide 21, let me discuss the revenue drivers for the quarter. Our 5 key business areas continue to grow steadily at 6% on an underlying basis, and they now represent 83% of total revenue.

GI, which represents approximately 1/4 of total revenue, is growing exceptionally well at 14%, spearheaded by Entyvio, which grew at 26%. Rare diseases is down slightly by 2%, impacted by the NATPARA recall and declined, as expected, in hemophilia.

But our HAE franchise is expanding very well with growth of 25%, driven by continued strong performance of TAKHZYRO growing at 66%. PDT Immunology had a strong quarter with growth of 19%, and we are continuing to invest in expanding our plasma collection center network with 4 new centers opened in quarter 1.

This brings the total to 36 new centers since closing the Shire deal 18 months ago. Oncology grew steadily at 5%, thanks to double-digit growth of brands such as NINLARO, ALUNBRIG and ADCETRIS. And neuroscience was negative 1%, with momentum impacted by COVID-19 stay-at-home restrictions.

Finally, other noncore products declined minus 21%, including the loss of exclusivity impact of products such as ULORIC. We will continue to assess opportunities to divest assets within this noncore segment. I'll skip over the next few slides, but please refer to them more in the coming presentation. Please turn to Slide 28.

So on Slide 28, this shows the reported revenue of our main products within our key business areas. In particular, we focus on maximizing our 14 global brands, indicated here by the red globe signal. In total, these products generated ¥308 billion in quarter 1 revenue and grew 20% on an underlying revenue basis year-on-year.

In particular, ENTYVIO, TAKHZYRO, Immunoglobulin, NINLARO and ADCETRIS performed well in quarter 1. Moving now to Slide 29, which shows the bridge from reported to core operating profit. Report operating profit was ¥167.3 billion. From this, we adjust out the noncash items related to the purchase accounting.

This includes a ¥26.6 billion cost of goods impact mainly from the unwinding of inventory step-up and ¥104.2 billion in total of amortization and impairment costs. We also adjust out ¥20.7 billion of onetime Shire integration-related costs, which are enabling us to realize our synergy targets.

In quarter 1 this year, we also recorded a one-time noncash gain of ¥60.2 billion related to Takeda being released from the obligation to divest SHP647. We also recorded a onetime noncash loss of ¥18.6 billion related to the contingent consideration for future Xiidra milestone payments. Please note these are both noncash items.

Adjusting for all of these, we arrived at a core operating profit for quarter 1 of ¥280.9 billion. Slide 30. This slide provides an update on how we are driving cost synergies and OpEx efficiencies across the organization.

In fact, just a few weeks ago, our procurement organization hosted Takeda's Second Annual Partner Value Summit where we held workshops and negotiations with over 150 of our suppliers. As a result, we estimate savings of approximately USD 100 million, incremental to the $200 million we achieved as a result of last year's event.

These savings are captured in the $2.3 billion of cost-synergy target that we expect to realize. We also took the opportunity to engage with our suppliers on ESG topics, including reduction in carbon emissions.

Another critical enabler of improving cost efficiencies is Takeda Business Solutions or TBS, a fully functional global team that supports numerous functions to leverage scale and drive optimization.

One core focus of TBS is increasing the use of robotics, and we have rapidly scaled up from 5 to 70 robots, transforming the way we work at boosting productivity. Please turn to Slide 31. This slide shows our underlying core operating profit margin evolution.

As you can see, we continue to make great progress towards our medium-term target of top-tier margins in the mid-30s. Quarter 1 of fiscal year 2020 was very strong at 34.7%. As in prior years, quarter 1 did benefit from some cost phasing, and our excellent start to the year reinforces our confidence in reaching the full year target of low 30s.

Switching now to cash flow. Please turn to Slide 32, which shows the evolution of our cash balance over the quarter. Operating cash flow was ¥145.9 billion, growing 21% versus prior year, reflecting lower integration costs. Free cash flow, which also takes into consideration income from asset sales and CapEx, was ¥146.3 billion.

This includes a ¥40.9 billion net gain from the acquisition and sale of marketable securities. This robust free cash flow comfortably covered the half year dividend that was paid in June, and we ended the quarter with strong liquidity of approximately USD 12 billion. Moving to Slide 33.

This -- Takeda remains fully committed to our target of 2x net debt to adjusted EBITDA in the medium term. In quarter 1, we were able to further deleverage to 3.7x, down from 3.8x in March, and this is even after paying the half year dividend. The ratio also benefited from stronger adjusted EBITDA over the past 12 months.

On Slide 34, we provide a summary of our divestiture progress towards our $10 billion target. Since April 2019, we have announced 6 deals with total proceeds of up to USD 8 billion. Three have closed to date. I would like to clarify that the Xiidra potential milestones, none are attached to the EU approval.

Therefore, although we recognize a decrease in the fair value of the contingent consideration, there is the possibility to receive up to the full $1.9 billion in cash for Xiidra milestones. On this slide, I also want to emphasize that we are unlocking cash from the balance sheet through the sale of real estate and marketable securities.

Already in quarter 1, we sold approximately USD 410 million of securities and have announced our plan to sell and leaseback the iPARK facility in Shonan, Japan. Slide 35. Earlier this month, Takeda took the opportunity to conduct $11 billion of leverage-neutral refinancing with record low coupons in order to extend debt maturities.

After the completion of refinancing, our average interest expense now stands at 2% versus 2.1% at the end of the prior quarter. Comparing the new debt ladder on the right to the previous ladder from March 2020 on the left, you can see that we have lowered the debt towers in the next few years, most significantly in fiscal year 2023.

As a result, our weighted average maturity extends from approximately 10 years to 14 years, which includes 60-year hybrid bonds callable in fiscal year 2024. Again, this refinancing is leverage-neutral and does not, in any way, change our commitment to deleveraging to our target of 2x within fiscal years 2021 to 2023. Moving now to Slide 36.

During quarter 1, we recorded some large, one-time noncash items that were not in our original forecast. As a result, we are raising our reported operating profit forecast to reflect the net impact of SHP647 gain and the loss on the Xiidra contingent consideration.

As a result, our full year reported operating profit forecast increases by ¥40 billion to ¥395 billion. Slide 37 shows our updated full year forecast. As described on the previous slide, we have raised the reported operating profit forecast by ¥40 billion to ¥395 billion.

We are also raising our reported EPS forecast by ¥20 to reflect certain noncash items that we booked in quarter 1 and their associated tax implications. Core and underlying guidance for the full year remains unchanged.

So in closing, I would like you to turn to Slide 38, and I would like to emphasize our excellent start to the year and our focus on delivering against our financial commitments. Firstly, we are delivering results with underlying revenue growth in quarter 1 of 0.9%, driven by our 14 global brands growing at 20%.

We are also focusing relentlessly on improving margins, and our quarter 1 underlying core operating profit margin was very strong at 34.7%. We are making significant progress on divestitures as we look to accelerate deleveraging and focus on our key business areas.

We are financially resilient, and our recent debt refinancing allows us to spread the debt maturities while remaining on track towards our deleveraging target. We ended quarter 1 with net debt to adjusted EBITDA of 3.7x, and we remain confident to reach 2x within the fiscal years 2021 to 2023 time frame.

Before we start to -- the Q&A session, I'd like to draw your attention to Slide 39 where we list some upcoming investor events.

In particular, we are planning an event in the second half of fiscal year where we will provide further details on the market potential of our Wave 1 pipeline and why we believe in its potential to deliver over $10 billion in peak revenue. Thank you for your attention. And now we'll move to Q&A..

[Operator Instructions]. The first question is from Mr. Yamaguchi, Citigroup..

Can you hear? This is Yamaguchi speaking..

Yes. Thank you, Mr. Yamaguchi..

Let me ask you questions, and I may put all the questions I have. My first question is about PDT business. What is the reasons driving this PDT business, which is quite strong? And the second is about PDT collection. And many people are saying that or many other companies are saying that they have some impact in the U.S.

regarding PDT collection, what about you? And number three, warning letter. We had many different comments. And in the normal operation, in order to solve these inspection-related issues, probably several quarters or more than that, maybe they consult.

So I would like you to tell how long it would take to solve the issues relating to the inspection? That's my third question..

Thank you, Yamaguchi-san. It's Christophe here. I will answer the question regarding the Hikari situation. And Julie, who is online, I believe, will answer the question regarding the PDT business and the collection situation. So on -- regarding the Hikari situation, the FDA audit happened last November.

And so we were aware of the issues and the situation, and we immediately started working on the remediation. We -- typically, if you look at the industry, it takes 12 to 18 months to be ready and be, what we call, inspection-ready. So that means that you have remediated the issues. And that's what we are seeing right now at Takeda.

So we believe that closer to 12 months, we believe that within 12 months, we will be ready for inspection, if you like. And we'll have remediated the issues, which means that will bring us at the end of the calendar year.

Julie?.

Yes, hello. Thank you for the question, Yamaguchi-san. In terms of the drivers of the growth, so first, I do need to point out that part of the exceptionally high-growth is driven by the fact that we had timing issues in Q1 of 2019. So Q1 2019 was particularly low in terms of IG.

But there is strong underlying demand growth, particularly for our subcutaneous portfolio. And as you have seen, since the close of the transaction, we have continued to grow our collections and our capacity. So we've been able to provide more medicines to meet the demand for our IG portfolio.

So there is strong underlying growth, but part of the exceptional growth is due to a comparison of a low Q1 of 2019. In terms of the impact that we see on our collections, so we did see a decrease in our collections as the various different quarantine and shelter-in-place orders went into effect across Europe and in the U.S.

At this point, our European -- I'm sorry, our European collections have recovered. And in the U.S., we do still see some impact as the pandemic is not under control yet in the U.S. However, I think a key difference is that we continue to build out our collection centers and grow our overall network.

Our locations are not necessarily in areas that were heavily impacted in the spring time frame, but we do have to remain diligent to watch what happens as the U.S. continues to combat the pandemic across the total geography, and we are seeing variances across the different locations..

From Daiwa Securities, we have Hashiguchi-san..

Yes. This is Hashiguchi. I have a question about TAK-994. In Phase I, what was the data that you obtained? For IV Phase I, even healthy volunteers showed strong signs of efficacy. What about 994 Phase I? How did it work? And when it comes to PK profile, are you happy with the data that you have obtained? Oral formulation versus IV formulation.

Maybe IV for stronger efficacy and the overall formulation for convenience, is that how you see that for different usage? Or do you think overall will cover everything? And the Phase II, how many administration? What is the frequency of administration per day? Those are the questions. And I have another set of questions.

Unemployment rate is increasing in the U.S. Payer mix is changing. How did that impact you in the first quarter and what is the future potential for impact? And which are the products most likely affected by this change? That's all..

Thank you, Hashiguchi-san. I will answer the second part of the question regarding the U.S., and Andy will cover your question regarding TAK-994. So in the United States, yes, there is a very increased level of unemployment. At the moment, at Takeda, with our portfolio, we have not seen a significant shift of channel. So we have not seen that so far.

And of course, we need to monitor that situation, but we have not seen a significant shift. At the same times, we have upgrade our patient assistance programs. For example, we do help patients to be able to pay for the medicine if they have lost their job because of the coronavirus crisis, for example.

So we are very conscious that we need to support this patient. But regarding channel shift, we have not seen significant challenge shift today.

Andy?.

Yes. Thanks, Christophe. And thank you, Hashiguchi-san, for the question. Just to be clear, TAK-925 as an IV agent does not have a path forward to treat, really, any of the conditions that we're most interested in. We are looking at some in hospital applications for an intravenous agent.

And we're also continuing to advance novel formulations of TAK-925 that could move us away from the IV space. But really, our focus is on our oral molecules, and the lead one is TAK-994. As I mentioned, we have additional molecules that will enter the clinic later this year.

In terms of the Phase I studies, we only ran our Phase I in healthy volunteers. We didn't -- did not do any formal assessments of efficacy, so that's where we're going to get now from our Phase II study. In the Phase I study, we were really pleased with the oral bioavailability, the PK profile. We sampled CSF from patients.

And we see appreciable levels of TAK-994 in the CSF, significant enough levels, that based on our modeling, we should see efficacy not different from TAK-925. I mean it's, of course, a very complex biology that we're dealing with, and there's a lot that we don't know in terms of exposure profile.

Obviously, there's a concern that if exposure levels are too high in the evening, it could disrupt sleep. And in fact, one of the most frequent adverse effects that we saw in our Phase I healthy volunteer studies was, indeed, insomnia. In terms of the dosing for the Phase II study, it's a dose-ranging study.

So we believe that this will set us up then for our pivotal study. So we're looking at both once-daily and twice-daily doses..

Next question is from Mr. Sakai, Crédit Suisse..

My first question is that you updated on 924, pevonedistat, and rather than details of the mechanisms, I'd like to ask you about its marketability. High-risk patient population, that's your first target. And I understand that number of patients are described here. But in last year's R&D conference, we've won 30 products -- project.

The total revenue, at least ¥1 trillion. I think that's what you said. And back then, or as of today, pevonedistat proportion, how much does it represent out of the total ¥1 trillion, either the amount or what is the potential of this particular compound? Because we see, in our view, that there are some gaps.

924 biomarkers could be a very good narrowly selected success model. And therefore, I'd like to see more about its potential. And another question goes to Iwasaki-san.

In the past several weeks in Japan, early retirement -- sorry, early support programs to be introduced for the people who wants to switch their jobs? And Takeda, Teva, Genex transferred to Nichi-Iko, that's announced today.

And resource development, how, Iwasaki-san, are you going to handle business in Japan? Are you going more for efficiency? And how these two projects or plans are meaningful in your Japan business?.

So thank you, Sakai-san. It's Christophe here. I will cover the first question regarding pevonedistat. So if you look at the prevalence of the disease, if you look at MDS, for example, we are talking about 20,000 patients in the G7 countries, and about 60% of these patient could be patient treated by pevonedistat.

And AML, in the G7 countries, it's about 45,000 patient, and we believe that around 50% of this 45% could be treated by pevonedistat. So if you look at the market opportunity, it's a market opportunity which could be in the billion U.S. dollar range. Now pevonedistat is not alone in this market.

But there is a significant opportunity, and there is a very high unmet medical need..

We have been focusing on 5 business areas, and I would like to strengthen our focuses is even more in 5 business areas. And in the ethical pharmaceutical businesses, we would like to be more oriented. And in the coming -- forthcoming 5 years, including the new combinations, 31 approvals, that's our target number.

And that transformation will be supported by human talents. And therefore, each one of employees should be able to construct the meaningful satisfactory carriers. And to do so, to support them, we have several programs and future carrier programs that Sakai-san mentioned, that's not a part of a new programs.

I mean that -- there are some employees who want to go for their carriers under different environment and we'd like to support them, too. Therefore, it is not for the sake of headcount or cost reduction. And regarding Takeda-Teva deal. This time, Takeda-Teva strategy, change is the reason behind.

And regarding the products handled, we will continue to handle those products because we need to implement appropriate supply, continue to supply those products. Therefore, the launch of those products, which are to be transferred to Nichi-Iko, we will continue to support.

And therefore, in that sense, there will be no change for us to support Takeda-Teva. As a shareholder, we will continue to provide proper support to them..

Mitsubishi UFJ Morgan Stanley Securities, we have Wakao-san..

Yes. This is Wakao speaking. I know that you're running out of time. Just one question about costs. I understand cost control is actually successful. And there was big impact of that in the first quarter. So cost is reduced because of COVID-19 is lowering activity levels? I think that's what you mentioned.

What about the full year impact? You don't have SG&A plan or forecast for the full year, but do you think the full year SG&A will go down because of lower activity level due to COVID-19?.

I'll take that. Thanks, Wakao-san, for your question. You can see in quarter 1, our underlying core operating profit margin improved from 28.9% fiscal year 2019 to 34.7%. This is predominantly driven by the integration, execution of synergies. And so the deliverable of the 10 cost packages, synergy packages, we're tracking towards executing on those.

Given the fact that we, as of December last year, 99.6% of the organization and talent had already been announced. We've consolidated over 50 sites where our business is operated. We're leveraging Takeda business services, including automation, so significantly increasing productivity, and that will definitely improve the SG&A profile.

Having said that, we are also cognizant that there has been underspend in certain areas due to COVID-19. And that's mainly in the travel, both local and international, as well as meetings and events. But I can tell you, as of quarter 1, that represents just over about 1.5% of that margin improvement.

So fundamentally, the key driver has been the execution and the speed of integration, but we are seeing some of the COVID impact also provide some extra improvement of the margin..

Now in the interest of time, we would like to take the final question from Nikkei, Mr. Takagi..

Hello? I am Takagi from Nikkei Newspaper.

Can you hear me well?.

Yes, we can. Please go ahead..

I have several questions. First about the COVID-19 treatment or clinical trials and approval target time lines. Are there any changes from the time at the beginning of this fiscal year? If there are any changes, please explain.

And the next question is, what is your CapEx plan this fiscal year? How much is it and is it going to increase or decrease from the last year? And if there are any plus and minus, please explain the reasons. Are there any impact of COVID-19 or not? So these are my questions..

Thank you, Takagi-san. So perhaps Andy will answer the clinical trial questions and Costa, the CapEx plan.

Andy?.

Sure, Christophe. I'll start and then maybe I'll hand it over to Julie to comment on the hyperimmune program. So Takagi-san, we have 4 molecules outside of COVID-19 that we're studying in COVID patients. Two are pipeline molecules, so TAK-981 taking advantage of the immune activation mechanisms that we think will be beneficial in cancer.

We're in an early study, signal-seeking study with that molecule. TAK-671, which is a molecule that we think will have activity both on immune effects and also on viral replication, we're actually -- we've started a Phase I study, and we're hopeful of moving in the next couple of months into a larger-scale efficacy study.

And then 2 molecules that we'll be studying in larger Phase II/Phase III settings that test the Kallikrein-Kinin system, FIRAZYR and TAKHZYRO, both of those programs should be starting their study sometime between August and October. So we're still on the time lines that we had originally hoped to have data towards the end of this year.

Julie?.

Thanks, Andy. And in terms of the hyperimmune that is being developed by the COVID-19 plasma alliance, we are still on track. The alliance has produced the clinical supplies. NIH, which is the study sponsor, has filed the IND.

So at this point, we are waiting for clearance from the FDA, in which case the clinical supplies will be shipped and the patient can start being entered into the study. And so we still expect to see top line data and potentially, emergency use authorization before the end of the in the U.S..

Your question is Costa's, whom you've got speaking. You can refer to Slide 56 of the earnings announcement presentation. And there, you'll see our CapEx forecast. For the year, and it's a range between ¥180 billion to ¥230 billion. In the first quarter, we've spent ¥40.5 billion. So there's no change to our revised forecast. It's still within that range.

Thank you..

With this, we'd like to close the earnings conference call. Thank you very much in joining in this call. I would like to ask for your continued support. Thank you..

Thank you for your taking time, and that concludes today's conference call. You may now disconnect your lines..