FURUKAWA CO.,LTD.
Financial Results Briefing for the Fiscal Year Ended March 31, 2022
May 25, 2022

[Number of Speakers]

3
Minoru Nakatogawa
Hiroyuki Sakai

Ryohei Akutagawa

President and Representative Director
Director and Senior Executive Officer,
General Manager, Corporate Planning
Department
Manager, Public & Investor Relations
Section, Corporate Planning Department

Nakatogawa: Hello, everyone. I am Nakatogawa, President of FURUKAWA CO., LTD. Thank you very much fortaking time out of your busy schedule to participate in our financial results briefing today.
Since our founding in 1875, we have undergone significant changes, and currently operate in six divisions, but
we have received feedback from investors that it is difficult to understand our business activities.
As one of the ways to enhance our investor relations to help you better understand our company, we decided
to hold this event online.
We would appreciate your active questions and comments.

Today, as you can see, I will explain in the order of one to five.
We will omit the explanation on the reference materials, so please see them later.

This is the summary for today.
For the fiscal year ending March 31, 2022, net sales increased JPY39.3 billion from the previous year to JPY199
billion, and operating profit increased JPY2.1 billion from the previous year to JPY7.7 billion.
Net sales increased in all segments in the machinery business and materials businesses.
Operating profit was down in the industrial machinery segment and UNIC segment, but profit was recordedin the rock drill segment, which was in the red in the previous fiscal year. Also, three segments in the materials
business increased profits, resulting in a profit increase in the consolidated results.
For the fiscal year ending March 31, 2023, we forecast net sales of JPY209.5 billion, up JPY10.4 billion YoY, andoperating income of JPY7 billion, down JPY700 million YoY.
Net sales are expected to increase except for the rock drill segment and the real estate business.
Operating profit is expected to decrease due to the absence of expected price gains from the impact of metal
price fluctuations in the metals segment.
Regarding the next medium-term management plan, including climate change and decarbonization initiatives,
the medium-term management plan 2025 is scheduled to be announced in May 2023, at the time of the main
closing of the fiscal year 2023.
We also aim to improve our ESG rating score in the FTSE with the aim of becoming an ESG index stock.

We will progressively disclose risks and revenue opportunities related to climate change in line with the TCFD
framework by implementing our response to the CDP.
For electricity, which accounts for about 80% of CO2 emissions, Scope 1 and 2, we intend to switch toelectricity derived from renewable energy sources and promote carbon neutrality, including non-electricity,which accounts for about 20% of CO2 emissions.
In addition, in order to achieve net zero emissions, we will promote Scope 3 calculations and consider
measures to absorb CO2 through the use of company-owned forests.
I will explain the details later.

Since some of you are attending for the first time, I will briefly explain our value creation process.
Based on the Group's management philosophy, we have evolved and developed our copper minedevelopment technology into a variety of technologies, with machinery and materials at the core of ourbusiness.
We have positioned the machinery business as one of our core businesses, and now, through marketing
management that incorporates a CSV perspective, we aim to create not only corporate value but also social
value and continue to be a company that is needed by society.

This is the summary of financial results for the fiscal year ended March 31, 2022 and forecast for the fiscal
year ending March 31, 2023.
For the fiscal year ended March 31, 2022, net sales increased JPPY39.3 billion YoY to JPY199 billion, operating
profit increased JPY2.1 billion to JPY7.7 billion, and ordinary profit increased JPY2.2 billion to JPY8.9 billion.
However, profit attributable to owners of the parent decreased JPY900 million to JPY6.4 billion compared tothe previous year, which recorded an extraordinary income on sales of investment securities of JPY4 billion.
The financial situation is as shown. As a result, ROE was down 2% to 6.9%.
For the fiscal year ending March 31, 2023, we forecast net sales of JPY209.5 billion, up JPY10.4 billion fromthe previous year, and operating income of JPY7 billion, down JPY700 million from the previous year.
Ordinary profit is expected to be JPY6.9 billion, down JPY2 billion from the previous year, when foreignexchange gains were recorded, and profit attributable to owners of the parent is expected to be JPY4.7 billion,
down JPY1.7 billion.

This is the income statement
Net sales and operating profit will be discussed by division later in this section.
In the area of operating income and below, there was an extraordinary income, including a gain on negative
goodwill, resulting from the acquisition of shares in metal powder manufacturing and sales company,
Yamaishi Metal Co., Ltd.
However, gain on sales of investment securities for effective use of assets and restoration financial health wasposted in the previous year.
In addition, extraordinary losses including expenses for the demolition progress of the Furukawa Osaka
Building, was posted, as in the previous fiscal year.
As a result, profit attributable to owners of the parent decreased by JPY900 million to JPY6.4 billion.

This is the balance sheet.
Total assets increased JPY11.4 billion to JPY229.7 billion, and net assets increased JPY5.7 billion to JPY100
billion.
Interest-bearing debt decreased JPY4 billion from the end of the previous period to JPY65.6 billion.
The main factors are as described here.

This is the results by segment.
Net sales for the fiscal year ended March 31, 2022 increased in all segments of both the machinery businessand materials business. Sales in the machinery business, as a whole, increased by JPY8.3 billion to JPY76.9
billion, and sales in the materials business, as a whole, increased by JPY29.9 billion to JPY118.1 billion.
Operating profit increased, except for the industrial machinery segment and UNIC segment. Operating profit
in the machinery business as a whole increased JPY700 million to JPY4.6 billion, and that in the materials
business as a whole increased JPY1.3 billion to JPY2.3 billion.
Net sales for the fiscal year ending March 31, 2023 are expected to increase except for the rock drill segment
and the real estate business. Sales in the machinery business overall is expected to increase by JPY1.6 billion
to JPY78.6 billion, and sales in the materials business overall is expected to increase by JPY7.8 billion to JPY126
billion.
Operating profit is expected to increase in the three segments in the machinery business but decrease in thethree segments in the materials business.
For operating profit, the overall machinery business is expected to increase by JPY600 million to JPY5.3 billion,
while the materials business overall is expected to decrease by JPY1.1 billion to JPY1.2 billion.
LME copper prices and exchange rates, as well as assumptions and exchange rate sensitivities, are as described.
The copper price and exchange rate assumptions for the forecast for the fiscal year ending March 31, 2023
are USD9,400 and JPY120, respectively.

The changes in segment results from the previous year are as shown.
Net sales increased significantly in the fiscal year ended March 31, 2022, mainly due to higher sales in themetals segment and rock drill segment, while the forecast for the fiscal year ending March 31, 2023 is foroverall sales to increase, mainly due to higher sales in the industrial machinery segment and metals segment,
although sales will decrease in the rock drill segment.
Although operating profit decreased in the industrial machinery segment and UNIC segment for the fiscal year
ended March 31, 2022, overall operating profit increased, mainly due to an increase in the rock drill segment.
For the fiscal year ending March 31, 2023, we expect an increase in profit in the industrial machinery segment,
but a decrease in profit in the metals segment and other factors will result in an overall decrease in profit.

I will explain the results by segment in detail.
Please refer to the references at the bottom of the page when you have time, as they describe the features,
destinations, market share, etc. of the main products of each division.
First is the industrial machinery segment. Net sales for the fiscal year ended March 31, 2022 increased due tosales from large projects, bridges, and other work in line with volume.
Operating profit decreased due to lower sales of material machinery parts and overhauls.
The order backlog was JPY9.3 billion, down JPY400 million from the previous fiscal year, and included orders
for the construction of the upper part of the No.3 elevated bridge on the Tokai-Kanjo Expressway Daian No.2 ,and the replacement construction of the pedestrian bridge in front of Kameido Station for bridge projects, aswell as an enclosed hanging conveyor for construction of the Shin-Kobutoke Tunnel on the Chuo Expressway,among other large projects.
Regarding factors for increase and decrease in the forecast for the fiscal year ending March 31, 2023, overallsales are expected to increase due to increased revenue from pumps, sewage plant extended transfer facilities
and other pumping equipment, and bridges.
Operating profit is expected to increase due to higher sales.

In the industrial machinery segment, inquiries about belt conveyors are increasing as a method of conveying
earth and sand that contributes to social issues.
We are strengthening information gathering from consultants, general civil engineering general contractors,
and offshore civil engineering general contractors with the aim of adoption for new dam construction andrestoration work for national land resilience and disaster prevention and mitigation, as well as for river flood
control work.
As a result of these efforts, we are currently receiving many inquiries and consultations regarding this special
earth and sand transport method, including two for new dam construction, three for dam function restoration,
two for river flood control, and five for tunnel construction and other projects.
The size and certainty of each project varies, but we aim to obtain as many orders as possible.
For your reference, we have also listed recent orders for belt conveyors, which you can see later.
In material machinery, we are aiming to win orders for sectional plants centered on crushers, a strategic
machine, and we are aiming to win two new orders for steel slag manufacturers and cement manufacturers
in the fiscal year ending March 31, 2023.
Both are large properties with a value of over JPY1 billion.

Next is the rock drill segment.
Net sales for the fiscal year ended March 31, 2022 increased both in Japan and overseas, especially overseas
where sales increased by JPY5.7 billion from the previous fiscal year, mainly in North America, where demandfor construction machinery is strong, in addition to the increase due to the weaker yen.
Sales of hydraulic crawler drills increased in North America, the Middle East, Africa, and Southeast Asia, whilesales of hydraulic breakers increased in Europe and North America.
Operating profit increased due to higher sales.
Regarding increase and decrease in the forecast for the fiscal year ending March 31, 2023, we expect anincrease in net sales due to higher product prices and a weaker yen but expect a decline in overall sales due
to a decrease in sales related to tunnel drill jumbos because of delays in the construction schedule of the
Linear Central Shinkansen.
Operating profit is expected to increase due to product price hikes and yen depreciation, despite the negative
impact of lower sales.

The rock drill segment continues its transformation from a focus on volume to a focus on profit.
In Japan, we are concentrating on sales models and executing product sales strategies tailored to the market.
Specifically, we will concentrate our sales efforts on large-sized machines for hydraulic breakers, which is
attachment product, and on small-sized machines for hydraulic crushers.
We will also further strengthen our recurring revenue model, including maintenance and parts sales, inaddition to the main unit itself. In addition, we will implement price revisions for products and parts. Since
the capture rate of parts sales is high, we will promote regular replacement of critical parts.
Overseas, we will strengthen sales by focusing on models in Europe and the US as markets to attack.
Specifically, in North America, we will expand sales of large-sized machines for hydraulic crawler drills andhydraulic breakers.
In Europe, we will expand sales of medium to large-sized machines for hydraulic breakers. In addition, as inJapan, we will implement price revisions for products and parts, as well as expand parts sales by making theuse of genuine parts mandatory during warranty periods.
In Southeast Asia, we will create a crushed stone market and transform our dealer policies. Specifically, as ameasure to induce customers to switch from pneumatic drills to hydraulic crawler drills, we developed andlaunched an attachment drill that is easy to work with and affordable.
In addition to Indonesia, we plan to expand our sales to other Southeast Asian countries to promote the switch
to hydraulic drilling by inducing customers to switch from conventional pneumatic drilling to attachment
drilling, and to hydraulic crawler drilling in the future.

We continue to consider consolidation of sales subsidiaries in China, India, and Latin America.
Life Cycle Support has lagged behind in building an overseas service system and will strengthen its
organizational structure to make up for the delay.

Next is the UNIC segment.
Net sales in Japan for the fiscal year ended March 31, 2022 decreased mainly due to delays in crane erection
due to truck production cutbacks caused by parts procurement difficulties, despite a recovery in investment
appetite among wide-area rental companies and others.
Overseas, despite a decrease in shipments of mini-crawler cranes in North America due to a shortage of
construction materials and other factors, overall sales increased due to higher shipments of UNIC cranes in
China and other factors.
Operating profit decreased due to a worsening cost ratio caused by price hikes in steel and other raw materials,
as well as soaring ocean freight costs.
Regarding increase and decrease in the forecast for the fiscal year ending March 31, 2023, we expect net sales
to increase, despite the impact of Russia's invasion of Ukraine and price increases for steel and other raw
materials, as we anticipate a gradual recovery in the second half of the fiscal year from the impact of truck
production cuts and other factors, as well as a recovery in the North American market.
Operating profit is expected to remain at the same level as the previous year due to the impact of raw material
price hikes and other factors, despite an increase in income from higher sales.

As for measures in the UNIC segment, we will expand sales of mini-crawler cranes, residential cranes, ocean
cranes, etc., which are not affected by truck production cutbacks due to the shortage of semiconductors andother factors in Japan.
We will also seek to increase our market share of products for which demand is stable. Specifically, for regions
where the market share for UNIC cranes is low, we will work to raise the level of the market share by holding
safety seminars and promoting the radio-controlled performance unique to UNICs, etc.
For UNIC carriers, we will increase the market share by expanding sales of flat-type carriers.
Overseas, we will strengthen sales to Europe, the US, Southeast Asia, and the Middle East, as sales to Russia,
which accounts for about 30% of our overseas sales, are difficult due to the impact of Russia's invasion of
Ukraine.
We will also strengthen our sales, product, and technical service capabilities. Specifically, we are developing
a new mini-crawler crane for Europe and the US to be introduced, and we will promote large-size truckmounted cranes manufactured by Taian Furukawa for emerging countries in Southeast Asia, the Middle East,etc.
In addition, we will expand and enhance training tools for dealers, conduct training, and develop andstrengthen human resources.

Next is metals segment.
Net sales for the fiscal year ended March 31, 2022 will increase due to higher overseas market prices, althoughsales volume will decrease due to a gradual reduction in electrolytic copper production as a result of a reviewof the ratio of consignment smelting costs. The main factors for changes are as described.
Operating profit increased due to an improvement in the balance of consignment smelting income andexpenses resulting from a decrease in copper production and price gains from higher copper prices.
Of the operating profit, there was an operating income of JPY1.5 billion due to price gains, and excluding this,operating income was a loss of approximately JPY500 million. This structural deficit structure will be explainedlater.
With regard to increase and decrease in the forecast for the fiscal year ending March 31, 2023, we expect net
sales to increase as stated, mainly due to higher metal prices and a weaker yen, under the assumptions of acopper price of USD9,400 and an exchange rate of JPY120.
Operating profit is expected to decrease due to the absence of expected price gains from metal pricefluctuations, although we expect an improvement in the consignment smelting balance.
The breakdown of the JPY900 million decrease is an increase of JPY200 million in gains/losses on consignment
and a decrease of JPY1.2 billion in price gains.
In addition, as already disclosed in a timely manner, we have terminated the consignment contract with
Onahama Smelting and Refining Co., Ltd. and have reached a point of drastic review of the consignment
smelting business.

I will explain the details on the next page.

On May 12, 2022, the Company resolved to terminate the consignment contract with Onahama Smelting andRefining Co., Ltd. to consign approximately 34% of its annual copper production, or 24,000 tons, at the end of
March 2023.
With regard to the metals segment going forward, the only contract smelter will be the equity method affiliate
Hibi Kyodo Smelting Co., Ltd.
Copper production in FY2024 is expected to be about 46,600 tons per year, and with domestic sales of about
40,000 tons per year, exports, which are unprofitable, can now be significantly reduced.
We believe that this will enable us to secure profitability in terms of profit and loss on consignment.
Based on the same assumptions as the forecast for the fiscal year ending March 31, 2023, operating profit in
the metals segment will improve from JPY0 billion to JPY400 million, as shown in the table.
On a consolidated basis, the operating margin will improve by about 1% from 3.3% to 4.4%.
Let me explain the changes in the profit structure of smelting companies. As shown in the figure, in recent
years, ore purchase condition income has been disadvantageous to smelters due to instability in supply anddemand against the backdrop of China's strong demand for ore purchases, and it is difficult to expect asignificant improvement in the ore purchase condition income in part one of the figure in the future.

On the other hand, smelting costs in part two of the figure are on the rise due to increased investment inenvironmental measures and facility maintenance and renewal, their depreciation burden, and soaring
operating expenses such as electricity and heavy oil costs.
As a result, smelting costs have exceeded revenues from ore purchase terms and conditions, and thepreviously existing revenue in part three of the figure has become a deficit structure in recent years.
Apart from this, if profit and loss are generated by fluctuations in metal prices, and metal price rises as in thefiscal year ending March 31, 2022, it can boost profits by JPY1.5 billion.
The opposite is true if prices fall, so a fundamental review of the consignment smelting business was animportant issue for the Company.

Moving on to the electronics segment.
Net sales for the fiscal year ended March 31, 2022 increased due to increased demand for crystal products forsemiconductors and coils for automotive applications, stable demand for high-purity metallic arsenic forcompound semiconductors, and increased demand for aluminum nitride for use in thermal management
components and semiconductor manufacturing equipment components, among others.
Operating profit increased due to higher sales.
Regarding increase and decrease in the forecast for the fiscal year ending March 31, 2023, we expect net sales
to remain flat year on year, with continued strong demand expected for high-purity metallic arsenic andaluminum nitride.

Operating profit is expected to decrease slightly due to higher electricity and raw material prices for crystalline
products.
As for aluminum nitride, we plan to invest a total of JPY900 million to increase production.

Moving onto the chemicals segment.
During the period, sales of cupric oxide increased due to higher unit prices, resulting from the rise in copper
price, and strong demand for use in substrates, while sales of cuprous oxide increased due to higher copper
prices, despite lower demand for use in repair vessels due to the impact of COVID-19.
Operating profit increased due to higher sales.
Regarding increase and decrease in the forecast for the fiscal year ending March 31, 2023, we expect sales ofcupric oxide to increase due to continued strong demand for use in substrates and the effect of higher copper
prices. We also expect an increase in overall sales.
Operating profit is expected to decrease overall due to the impact of deterioration in the cost ratio of cuprous
oxide caused by higher raw material prices and other factors, although cupric oxide is expected to increase
due to higher sales.
In addition, investment to increase production of cupric oxide is under consideration.

The next section summarizes the achievements of the year.
As we aim to sustainably expand our machinery business, progress was made in the industrial machinery
segment and UNIC segment in accordance with the basic strategies of the medium-term management policy
2022. In the rock drill segment, where the basic strategy has been revised, a fundamental review of overseas
operations has made progress.
Specifically, the industrial machinery segment is seeing an increase in projects and inquiries, as it seeks tomove away from being a mere equipment manufacturer, including an increase in inquiries for belt conveyors
and material machinery section plant construction projects.
In the rock drill segment, as part of a review of its overseas structure, the Company changed its strategy byterminating local production of unprofitable hydraulic breakers in China and launching an attachment drill aspart of its market development efforts in Southeast Asia.
In the UNIC segment, we promoted the development of large-size truck-mounted cranes, for which demandis increasing in overseas markets, and worked to expand our product lineup from small to large cranes toestablish a foothold for sales expansion in the Asia and Middle East regions.
Next, as part of the sustainable development of our machinery business, we acquired Yamaishi Metal Co., Ltd.,
which possesses powder manufacturing technology, in October last year.
By incorporating the metal powder handling technology and know-how of Yamaishi Metal, we will strengthen
the development of the Group's powder metallurgy technology centered on molding, sintering, and heat
treatment technologies, aiming to create key components and materials for machinery products with

excellent sliding resistance, impact resistance, and high thermal conductivity. This is expected to differentiate
us from our competitors, and further add value.
As for the metals segment, a drastic review of the consignment smelting business has been completed. At theend of March 2023, the consignment smelting contract with Onahama Smelting and Refining will beterminated, and the Company will further focus on its core machinery business.
Due to the decrease in copper production in the metals segment, we expect to be able to significantly reduce
unprofitable overseas exports and ensure the profitability of the consignment smelting business.
The impact of metal price fluctuations on profit and loss can be reduced by terminating the contract with
Onahama Smelting & Refining.
We will continue to focus on the machinery business to increase the absolute amount of operating income,thereby reducing the profit/loss impact of the metals division.

Next, the 2025 vision and each phase are as described.
FY2023 is the second phase of the 2025 Vision, a long-term vision of where we want to be in our 150th yearof business.
We have formulated and announced a single-year forecast in accordance with the Medium-Term
Management Policy 2022.

Currently, we have set milestones for PDCA and are rolling out a mid-term management plan as an important
tool for achieving our 2025 vision.
However, although we will promote our business activities by following the PDCA cycle, preconditions arechanging, including the spread of new COVID-19 infections, Russia's invasion of Ukraine, and raw material
shortages due to the shortage of semiconductors.
We are considering incorporating these changes into the next medium-term management plan.
The next medium-term management plan, which will take an ESG perspective important for the Company's
long-term growth and provide direction for business growth strategies, capital policies, etc., will be
formulated and announced at the time of the announcement of financial results for the fiscal year ending
March 31, 2023.

We also view inclusion in ESG index stocks as important for confidence in the Company and stock priceformation.
We intend to enhance the disclosures required for ESG ratings, and to strive for inclusion in the FTSE index
issues.
This spring, we were selected as a component stock of the FTSE Blossom Japan Sector Relative Index, which
is used by the GPIF as an index.
In the future, we will strengthen our ESG initiatives and disclosures required by the FTSE Blossom Japan Index
and FTSE 4Good Index, which have stricter selection criteria.
Specifically, the FTSE ESG rating score for 2021 was 2.5 overall, but by 2025, the 150th anniversary of theCompany's founding, we aim to achieve an overall score of 3.3 or higher and become an index stock.

Next, I will explain our approach to climate change and decarbonization and our efforts.
Regarding our response to disclosures based on the TCFD and equivalent frameworks, we will gradually move
forward with disclosures in line with the TCFD framework by using our responses to the CDP regarding risks
and revenue opportunities related to climate change. First, we will implement early responses to CDPs thathave not yet been responded to.
As for our efforts toward decarbonization, carbon neutrality, and net zero, we are currently developing a plan
to implement CO2 reductions in line with the government's announced CO2 reduction targets of a 46%
reduction in CO2 emissions by FY2031 compared to FY2014 and achieving carbon neutrality by FY2051.
Regarding carbon neutrality, we are considering converting electricity, which accounts for about 80% of our
CO2 emissions, to electricity derived from renewable energy sources.
We will aim for early disclosure, including plans to reduce CO2 emissions from non-electricity sources, which
account for about 20% of our CO2 emissions.
As for net-zero emissions, we are proceeding with Scope 3 calculations and considering measures to absorb
CO2 through the use of Company-owned forests, etc., with the aim of achieving net-zero emissions in the
future.
We will also contribute to the realization of a decarbonized society by providing products, technologies, andservices that are highly effective in reducing greenhouse gas emissions.

For example, belt conveyors can be used as an alternative to dump trucks for transporting earth and sand,thereby, contributing to the reduction of CO2 emissions in tunnel excavation, regulating reservoir
development, dam function rehabilitation, and other construction projects.
In addition, the new control system of the UNIC crane reduces engine speed by up to 47%, reducing diesel oil
consumption by up to 40% and contributing to a reduction of CO2 emissions by up to 40%.

Next are FY2022 topics.
FTSE Russell, a global index provider, has selected the Company as a component of the FTSE Blossom Japan
Sector Relative Index for the first time.
The Company was also selected for the first time as one of the 2022 Health & Productivity Stock Selection,
which selects companies with particularly outstanding health management initiatives that consider employee
health management from a managerial perspective and strategically implement them.
Other external evaluations include a three-star rating in the Nikkei SDGs Management Survey 2021, whichrates companies' commitment to the United Nations Sustainable Development Goals, SDGs, and a DBJ
Environmental Rating Loan from the Development Bank of Japan, which gave the Company the highest ratingof particularly advanced in its commitment to environmental considerations for the seventh consecutive year
since 2015.

We will continue to enhance our disclosure.
To this end, we are stepping up our sustainability efforts.
In order to enhance the value of the Furukawa brand through marketing management that incorporates a
CSV perspective, and to increase corporate value by implementing business operations that take into
consideration the Group's CSR/ESG issues, we have formulated the basic policy as described above, and began
implementing it on December 1, 2021.
At the same time, we are strengthening and expanding our system for promoting sustainability activities andother initiatives.
We will reduce risks and maximize opportunities through defensive and offensive sustainability.
The information on page 28 onward is for reference only, so please check it later.
That is all the explanation for today.
I would like to ask our shareholders and investors for their continued support of the ever-changing
FURUKAWA.

Question & Answer

Questioner: My name is Abe from Daiwa Securities. I have two questions.
First, you mentioned that demand for construction equipment in North America is strong. Please tell us about
the continuity of this demand and the business environment, including in Japan.
Second, you mentioned that sales in Russia account for 30% of your total sales. How much of the current sales
have decreased, and how much of that has been covered by other regions?
Nakatogawa: First, regarding demand in North America, in the rock drill segment, the products we sell are
hydraulic crawler drills, which are used in quarries and limestone piles. This was sold to a local company, also
known as an explosive smasher, because the economy was booming over there.
In terms of continuity, there was a slight increase last year as a reaction to the portion restrained by COVID19, but inquiries we are receiving this year continue to be strong and we expect the demand to continue thisfiscal year as well.
As for UNIC segment, there was a slight decline in the previous fiscal year, but with the convergence of COVID19, the business situation has improved, and we expect sales of mini-crawler cranes to be strong this fiscal
year.
In Japan, the domestic market for both rock drill segment and UNIC segment is expected to remain flat. Under
this circumstance, we would like to sell hydraulic crushers, which have yet to grow, and large hydraulicbreakers, or mini-crawler cranes and residential cranes in UNIC segment.
As for Russia, more than 20% of our sales in the UNIC segment are from overseas markets. Of that more than
20%, roughly 30% is destined for Russia.
Currently, we are not shipping to Russia, but are selling local stock, all of which has been sold. In terms ofoperating profit in the UNIC segment, we expect this to be the factor of about JPY100 million decrease.
However, it is not a special model for Russia, and we are currently conducting sales activities to resell it inSoutheast Asia and elsewhere.