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- 00:38:27.5 As you are probably aware, SSB’s main businesses are railway station systems, traffic control and signaling systems. As is the case every year, given the nature of SSB’s customers, there is a significant skewing of both revenue and profits to the month of March. With regard to the degree of confidence we have in achieving our forecasts, we are highly confident of achieving this fiscal year’s figures. As is the case every year in this business, we take in orders and manufacture over the course of the fiscal year, for delivery toward the end of the fiscal year. As such, we do not expect to see a significant divergence from our forecasts.
- 00:39:12.0 Thank you.
My second question is related to an earlier question about personnel changes.
I understand that you will be stepping down as CFO. Could you talk about what you feel were your achievements as CFO? Are there things that you hoped to achieve but will not be able to see through to fruition? Are there things you had hoped to achieve that will happen in the next few years?
- 00:39:58.8 As you know, I am a humble person, so I would hesitate to take personal credit for any achievements during my tenure as CFO. I know that this kind of comment might prompt some of you to speculate but, I would find it too embarrassing to talk about my achievements.
In terms of the things that I aimed to achieve that have yet to happen, I do believe that Omron still faces a number of challenges. In particular, it has been challenging to forecast for some of our more volatile businesses. I recognize that this has been a source of some confusion to date. Additionally, we were forced to take major write-downs, which probably came as a surprise to many of you. Fortunately, given the scale of the write-downs relative to our overall business, we have been able to mitigate the impact.
We have been able to make progress on improving profitability and adapting to a changing competitive landscape within the PPM framework. There has also been a broad acceptance of ROIC management throughout the organization. However, given my responsibilities for the overall PPM process, I did find it challenging to attempt to project the future of a business or market and to think about how best to leverage Omron’s strengths in any given market. I think PPM and long-term business strategy planning are intertwined. I do not necessarily have a clear answer for the big picture questions.
However, at a minimum, I do believe that society now demands that we give due consideration to establishing the correct core focus for Omron in a given business, developing future projections and on that basis, choosing the businesses that are right for Omron. Therefore, there is a clear need for a deeper consideration of PPM and long-term business strategy, which must go beyond conventional incremental improvements. We must be able to make changes to reflect our view of the future. In this area, I believe there is still much more we must do.
In looking back at my time as CFO, my biggest regret is that we were not able to make further progress in this area, for which I apologize.
I do believe that I have been able to make some small contribution on the operational front, in my own humble estimation.
I have worked for Omron for 42 years. It is my impression that our employees are very excited about their respective businesses at this time. Everyone is excited about the potential opportunities driven by IoT and AI, which Omron hopes to capture through Sensing and Control + Think. Through ILOR+S, Omron offers full coverage of manufacturing processes and is the only company that is able to fully leverage all of the data associated with these processes. We are now starting to see some of this potential coming through. Over the next four years, I would sincerely hope that we can capture even a small part of this exciting opportunity.
- 00:40:28.0 Thank you.
- 00:43:30.2 Are there any more questions?
- 00:43:34.6 I have two questions.
I would like to confirm my understanding of the full year forecasts. The implied local currency growth rate for Q4 on a standalone basis is actually down YoY. Is this because you are simply taking a conservative view or is there a reason for this? Also, you talked about IAB doing very well in China. Is the upward revision to revenues due purely to China or are you seeing improvements in other areas as well?