Sumco Corp Ord

Thank you for your participation today. This is the results briefing for the fourth quarter of the fiscal year ended December 2025. Before starting the presentation, allow me to confirm today's materials, which consists of three items. The Consolidated Financial Results for the Fiscal Year Ended December 31, 2025, the Announcement Concerning Difference Between Forecasts and Actual Figures for the Fiscal Year Ended December 31, 2025, and the Presentation Deck Entitled Results for Fiscal 2025, which we will use now. Next, a disclaimer. The estimates, expectations, forecasts, and other future information discussed here and shown in today's materials were prepared based on information available to the company as of today and on certain assumptions and qualifications, including our subjective judgment. Actual financial performance or results may differ substantially from the future information contained in this material and due to risk factors including domestic and global economic conditions, trends in the semiconductor market, and foreign exchange rates. We will have presentations today from Representative Director, Chairman and CEO, Mayuki Hashimoto, and Representative Director and Vice President, CFO, Shinichi Kubozoe. Chairman and CEO Hashimoto will discuss our forecast and operating environment to be followed by an explanation of the financial results by CFO Kubozoe. We have set aside time for a Q&A session as well.

I will now hand over to Chairman Hashimoto. I am Chairman Hashimoto.

I will start with an overview of the results. I often get scolded for missing forecasts, but this time we overshot quite significantly. With regard to the 5.5 billion yen overshoot in operating profit, major factors were 2.1 billion yen from cost reductions, a 1.7 billion yen impact from Forex, and 1.2 billion yen as a result of delays to depreciation. These three items alone total 5 billion yen. However, despite the increase in sales, the contribution of volume and product mix to profit was only around 0.5 billion yen. This is because there was a relatively higher level of polished wafer or PW sales. Marginal profitability for epitaxial wafers is actually slightly higher than PW, so despite top-line growth, the shift in product mix had an impact on profits. With regard to Q1 earnings forecasts, the actual content for the quarter is largely unchanged from fourth quarter. The reason for the 1.5 billion yen Q1Q widening of the loss is the expected negative impact on production volume owing to periodic maintenance at a key plant slated for March, as well as one-off maintenance expenses related to the periodic maintenance. This is what is behind the Q1Q widening of operating losses. We expect no other major changes from Q4.