Sales in the first half of fiscal 2004 were 131.7 billion yen, approximately 1.9 times higher than the same period last year, or 1.11 million units, approximately 1.9 times the figure for the same period last year.
The retail prices of LCD color TVs were approximately 30% lower compared to those of the same size a year ago. Sales of our large-size LCD color TVs increased with the full-fledged operation at the Kameyama Plant. LCD color TVs 30 inches and larger accounted for more than 20% of our LCD color TVs sold in the first half of fiscal 2004. As a result, our ASP of LCD color TVs was higher than that of the same period last year.
According to our initial plan for all of fiscal 2004, we expect sales of 300.0 billion yen, about 1.7 times higher than that of the previous year. However, we have adjusted our original estimate of 3.0 million units down to 2.7 million units to reflect the trend towards larger LCD color TVs.

Regarding demand for large-size LCD color TVs, because the new 45V-inch digital high-definition LCD color TVs introduced in August in Japan are selling better than we expected, we are moving to larger models by aggressively introducing new models larger than 40 inches, an area in which PDP TVs were once thought to have an advantage over LCD color TVs. At CEATEC Japan 2004, held in October, we announced a 65V-inch LCD color TV, the world's largest. We plan to bring to market 50-inch and larger LCD color TVs within fiscal 2005. We are on the verge of solving several technical hurdles in manufacturing such large LCD color TVs, such as improving moving images on a large display.
As for costs, since a shortage in LCD-related materials will likely be solved and since their price is expected to decrease, we will be able to reduce the cost of LCD panels for TVs and thus make our LCD color TVs, "AQUOS," more competitive, and at the same time we will enhance the sales of LCD color TV panels to other manufacturers.

In the spring of 2005, a third production phase will begin operation at the Kameyama Plant and substrate input will rise to 45,000 sheets per month from the current 27,000.
We estimate fiscal 2004 sales of LCD panels produced at the Kameyama Plant will be the same as our original figure, 150.0 billion yen. We will make a decision on the specifications of the Kameyama No.2 Plant at the beginning of 2005, with full consideration for factors like market trends and production technology innovations.

As we enter an age of ubiquitous networking, small- and medium-size LCD panels are experiencing ever-increasing demand for use in mobile terminals such as mobile phones and game consoles. This is why more and more manufacturers in Japan, Taiwan and Korea are entering this market. We possess a number of one-of-a-kind LCD technologies suitable for a wide range of applications. These include semi-transmissive LCDs, which can be used in both light and dark settings. We utilize our patents and keep our manufacturing technologies as "black-box" to prevent leakage to other companies, which separate us from the competition. We also have design centers in Tokyo, Europe, China and the U.S. that form a global support system that meets user needs right from the design stage. As well, we are moving the back-end process of small- and medium-size LCD production to China, where more and more manufacturers of assembled products are establishing bases. This aims to further reduce cost and lead-time. For System LCDs, robust demand is continuing, primarily for mobile phone displays. Sales of System LCDs in the first half of fiscal 2004 were 90.0 billion yen, up about 3.9 times from the same period last year.
Sales for all of fiscal 2004 are estimated at 180.0 billion yen, about 2.1 times the same period previous year.

Sales of LCDs as a whole during the first half of fiscal 2004 were 360.0 billion yen, up 52.3% over the same period last year. Large-size LCDs accounted for 40% of this, while small- and medium-size LCDs accounted for 60%.
Currently, increased production by LCD panel makers in Korea and Taiwan is causing price reductions of commodity type large-size LCD panels, mainly those used in notebook PCs and LCD monitors. However, the majority of our sales comes from high-value-added panels for applications such as LCD color TVs, mobile phones, car navigation systems and game consoles.
Sales of LCD panels for notebook PCs and monitors accounted for less than 10% on a monetary basis of our sales estimates for all LCD panels for all of fiscal 2004. Since, as mentioned above, our LCD business is hardly affected by market fluctuations, we still estimate that overall sales of LCDs for fiscal 2004 will be 730.0 billion yen, up 38.0% over the previous year, as initially planned at the start of the fiscal year.

Sales for the first half of fiscal 2004 were 202.4 billion yen, up 22.6% over the same period last year, accounting for 5.05 million units, an increase of about 15%.
During the first half, we started full-scale production of 3G-compatible mobile phones. 3G handsets accounted for about 40% of our mobile phones sold in Japan. We will continue to improve our development efficiency and develop 3G handsets with distinctive features utilizing our original device technologies.
Regarding sales of mobile phones for all of fiscal 2004, we are making an upward adjustment, from our original forecast of 350.0 billion yen to 370.0 billion yen, up 11.0% over the previous year. This represents 10 million units, up 15%.

Sales of solar cells in the first half of fiscal 2004 were 52.7 billion yen, up 55.0% over the same period last year.
Annual production capacity was increased in June this year from 248 MW to 315 MW, thereby increasing Sharp's world-leading production capacity even further. In order to continue to meet vibrant overseas demand for solar cells, we will increase module production capacity in the U.S. and the U.K. In terms of performance, our solar cells have already achieved the world's highest conversion efficiency for residential use, at 17.4%*. We will continue to improve the conversion efficiency, cut production costs and promote the expanded use of photovoltaic power systems.
We upwardly revised our fiscal 2004 solar cell sales estimates, from 90.0 billion yen to 110.0 billion yen, a 50.3% increase over the previous year.

*As of October 1, 2004, for mass-produced solar cell modules for non-outer-space uses.