Consolidated financial results for the first half of fiscal 2013 (April to September 2013) recorded net sales of 1,342.0 billion yen, up 21.5% compared to the same period last year. Operating income was 33.8 billion yen, while net loss was 4.3 billion yen. The results all exceeded the revised forecast announced on September 18, 2013, and represent a great improvement compared to the same period last year.

In the three months of the second quarter of fiscal 2013 (July to September 2013), positive results were achieved for operating income and net income. The operating margin, which was 0.5% in the first quarter, improved to 4.2% in the second quarter.

In the first half of fiscal 2013, sales of all product groups except Digital Information Equipment showed growth compared with the same period last year. In particular, Solar Cells, Business Solutions, LCDs, and Electronic Devices showed a significant improvement in results. This growth in sales resulted in a 237.8 billion yen total sales increase compared to the same period last year.
As for operating income, all product groups were in the black. As a result, there was a 202.7 billion yen total increase in operating income compared to the same period last year.

Looking at a breakdown of operating income by key contributing factors with a comparison between the first half of fiscal 2012 and the first half of fiscal 2013, as part of our business restructuring efforts, a 70.9 billion yen cutback on fixed costs centering on labor costs, as well as a 75.2 billion yen effect from reduction mainly in inventory and noncurrent assets, contributed to an improvement in operating income in the first half of fiscal 2013.

For the first half of fiscal 2013, despite an increase in interest expense, other income (expenses) showed a significant improvement compared to the same period last year, thanks partly to the elimination of irregular costs from business restructuring.

A redemption of convertible bonds was completed at the end of September 2013. Due to this, there was a decrease in short-term borrowings which was slightly offset by additional borrowing facilities provided by financial institutions.
The net asset balance was 146.6 billion yen and equity ratio improved from 6.0% at the end of March 2013 to 6.4%. This resulted from a second third-party allotment capital increase to Qualcomm Incorporated and an improvement in foreign currency translation adjustments brought on by a depreciating yen.
[Supplement]
If we reflect the total amount of 126.5 billion yen settled by the end of October 2013 for capital increase through a public offering and third-party allotments with DENSO CORPORATION, Makita Corporation, and LIXIL Corporation, in the net assets at the end of September 2013, the equity ratio is approximately 12%.

The inventory level at the end of September 2013 decreased by 38.6 billion yen from that at the end of June 2013. At 317.5 billion yen, it is close to the level recorded at the end of March 2013.
The ratio vs. monthly sales fell from 1.76 months to 1.42 months, due to sales expansion.

The interest-bearing debt at the end of September 2013 was 1,195.3 billion yen, an increase of 25.8 billion yen compared with the end of June 2013. However, the ratio vs. monthly sales improved by 0.43 months.
We will strive for a further reduction of the interest-bearing debt by improving cash flows.