I am the CAFO, Muto. I will explain the financial results for the fiscal
year ended March 2020.

1First, an overview: As the title expresses, despite some COVID-19
impact, Terumo achieved its highest-ever revenue and operating profit.
Revenue, particularly that of the Cardiac and Vascular business in
China, was affected by COVID-19 in Q4; however, impact on the total
for the 2019 fiscal year was not severe. All companies achieved
revenue growth. Overall, revenue grew 5%, and 8% when excluding
FX impact.
Regarding adjusted operating profit, each company increased its
proportion of high-profitability products. In addition, goodperformance by the Cardiac and Vascular Company in the 1st halfenabled some promotional expenditures to remain unspent. All thisresulted in the Group achieving 9% adjusted operating profit and 11%
operating profit growth when excluding FX impact.
Profit for the year grew 7%, due to factors including less FX impact
than the previous fiscal year.
Next slide, please.

2Here is the comparison with original guidance that we announced at
the beginning of FY19.
Cardiac and Vascular finished below revenue guidance due to sluggish
sales of drug-eluting stents in Japan and elsewhere, in addition to theimpact of COVID-19 in the 4th quarter.
However, adjusted operating profit was 1.9 billion yen above guidance,
due to factors including that some expenditures for recovery from theshipping delay did not need to be made.
General Hospital ended up as planned for revenue and profit.
Blood and Cell Technologies ended up above its plan for revenue andprofit, when excluding FX impact. Please note that starting this fiscalyear, the company previously known as Blood Management will now
be called the Blood and Cell Technologies Company. Its revenue
exceeds 100 billion yen, and its business has expanded beyond
transfusion-related products to also include therapeutic apheresis andcell therapy technologies, so we have changed its name to more3

accurately express its business.
Next slide, please.

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Here is the adjusted operating profit variance analysis. Due to sales of
the TIS business of Cardiac and Vascular, and some Blood and Cell
Technologies products, coming in below volume plans, gross profit
increment by sales increase was 30.8 billion yen, lower than the 33
billion-yen guidance. In addition to product mix improvement in theCardiac and Vascular Company, production cost-reduction progressed
well, leading to gross margin improving 5.7 billion yen, above theguidance of 4.8 billion yen.
In price, the introduction of new software to the Trima blood
component collection system of Blood and Cell Technologies helped toprevent some of that companyʼs anticipated price erosion, leading to asmaller drop of 2.9 billion yen rather than the expected 5.0 billion yen.
The Japan price reimbursement revision impact was 2 billion yen,which was less of an impact than guidance. This was partially because
revenue was below expectations in Cardiac and Vascular, and becauseof delayed timing in some customers agreeing to the new prices.
Costs for the new EU MDR regulations were 1.4 billion yen, instead of4the 3.2-billion-yen guidance. Spending on MDR increased in the 2ndhalf̶the 4th quarter in particular̶but reconsideration of someproduct updates and shortened testing periods led to reduction ofthese costs, in addition to the postponement of system audits thatwere scheduled for March. In any case, our preparation for MDR tocome into effect is progressing on schedule. IT investment
amortization expenses came in according to guidance.
SG&A increase was 8.1 billion yen, against the 12.5-billion-yen
guidance. We had anticipated costs for TIS recovery from the shipping
delay. However, good business performance eliminated the need tospend that budget, and also, the Neurovascular product WEB saw
higher demand than expected, leading to a reduction in SG&A. R&D
increase was 5.7 billion yen, as anticipated in guidance. FX impact was
7.8 billion yen, exceeding annual guidance of 5.0 billion yen, due toyen appreciation against the euro, the Chinese yuan, and emerging
market currencies in the 2nd half.
COVID-19 impact on the Cardiac and Vascular Company in the 4thquarter was 2.7 billion yen. Analyzing this 2.7 billion yen, two-thirds ofit was impact on “gross profit increment by sales increase”, and onethird was impact on “gross margin” of the variance analysis chart.
Next slide, please.

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Next is revenue by region.
In Japan, the pain management and Alliance businesses of the General
Hospital Company grew in double digits, driving growth overall.
Outside Japan, all regions grew in the high single digits or double digits,
when excluding FX impact. In China, double-digit growth continued
through the 3rd quarter, but in the 4th quarter, the Cardiac andVascular Company saw COVID-19 impact that resulted in a drastic
slowdown.
Next slide, please.

5Here is revenue by business segment.
In Cardiac and Vascular, the Neurovascular business grew nearly 20%
in the fiscal year, driving the company overall. There was COVID-19
impact centered in China in the 4th quarter, but the company still
maintained double-digit growth.
In General Hospital, good performance by pain management andadhesion barrier products added to that of the Alliance Business fordouble-digit growth driven by Japan and other regions. The 4th
quarter saw increased demand for thermometers, disinfectant, andother products used in COVID-19 measures.
In Blood and Cell Technologies, the automated blood component
collection systems for blood centers drove the company overall.
Starting with the next slide, I will give more detail on each companyʼsresults.

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First, Cardiac and Vascular.
Revenue and profit both grew in double digits when excluding FXimpact. TIS was impacted by COVID-19 in the 4th quarter, especiallyin China, but it maintained double-digit growth for the fiscal year whenexcluding FX impact. In the Neurovascular business, COVID-19 impact
was limited up through March. WEB and stroke devices led by Sofia
drove growth to nearly 20% globally. In Cardiovascular, heart-lungmachines returned to the product lineup, making customer approaches
easier, in addition to strong performance by oxygenators, driving thegrowth.
In the Vascular Graft business, there was some slowdown in the 4thquarter due to COVID-19 impact.
Profit increased, with sales expansion of higher-profitability TIS andNeurovascular products. Also, there were anticipated expenditures for
TIS recovery from the shipping delay, and for starting neurovascular
WEB product promotion in the United States, which did not need tohappen in the 1st half as expected; because of these, profit increased

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7% year-on-year, and 16% when excluding FX impact.
Next slide, please.

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Next is the General Hospital Company.
Despite a temporary decrease in demand for General Hospital products
outside Japan, the Pharmaceutical and Alliance business grew indouble digits to drive the company as a whole. DM Healthcare saw
increased demand in Japan for thermometers in the 4th quarter, due
to their use in COVID-19 measures.
As a whole, the General Hospital Company achieved its guidance inboth revenue and profit.
Next slide, please.

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Next is Blood and Cell Technologies.
Revenue growth was driven by a software update to the Trimaautomated blood component collection systems for blood centers, anddisposable products. In addition, in the 4th quarter, there was acontribution from increased demand for collection of convalescentplasma from recovering COVID-19 patients. In therapeutic apheresis,
emerging markets in Asia and Latin America grew in double digits,
while there was recoil of replacement with the latest version of
consoles in developed countries. Overall, revenue grew 2%, and 6%
when excluding FX impact.
Due to cost and expense control, profit grew in double digits whenexcluding FX impact, coming out above plan.
Next slide, please.

9Regarding the dividend for the end of FY19, we have assessed theCOVID-19 impact and decided not to change the anticipated dividendof 14 yen, making the total annual dividend amount 28 yen. This is a
one-yen year-on-year dividend increase.
Next slide, please.

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We will skip over the FY19 major topics.
Next slide, please.

11This slide regards the COVID-19 crisis.
As was noted in the press, the Cardiac and Vascular Company
contributed ECMO systems for the treatment of severe COVID-19patients.
General Hospital products including thermometers and hand sanitizer
contributed to preventing the spread of the infection, while Blood andCell Technologies products including blood component collection andtherapeutic apheresis systems were utilized in the United States andother places.
This means that all companies of the Terumo Group are contributing toprevention or treatment of COVID-19.
Next slide, please.

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There are several products which will enter the market in FY20 rather
than FY19, but overall the pipeline is on track for product launches.
Next slide, please.

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Regarding guidance for fiscal year 2020, it is extremely difficult torationally figure out, so we will refrain from issuing guidance at thistime.
We will disclose our guidance as soon as circumstances permit us todo so. We ask for your kind understanding in this matter.
Some Terumo Group companies are more heavily affected than others.
Due to postponement in elective procedures, the Cardiac and VascularCompany is comparatively more affected. Type of procedures, region,
timing of effects, and other factors all have an impact, making
estimates very difficult.
The General Hospital and Blood and Cell Technology companies arealso somewhat affected, but in a more limited way than the Cardiac
and Vascular Company.
The next slide explains our thinking in more detail.

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I will now explain our thinking regarding the COVID-19 impact on theCardiac and Vascular Company. The vertical axis of the graph shows
revenue, and the horizontal axis shows the procedure segments ofUrgent, Elective (time-sensitive), and Elective (non-time-sensitive).
Within the same cardiovascular field, you can see that there arevarious circumstances for each segment.
When analyzing the impact on actual sales, we are unable to estimate
solely based on the procedure segment; rather, a given hospitalʼsfinancial situation, status of procedures being conducted at hospital oroffice, whether the sale is direct from us or through a distributor, andmany other factors affect the situation.
I realize that you may require further information, so please allow me
to share the latest regarding our April revenue, although theinformation is not on the slides. The percentage of revenue decreaseof the Cardiac and Vascular Company in April is in the mid-30s yearon-year. There is regional variance within that: The decrease is mostpronounced in the United States, followed by Europe, China, other15

Asian countries, and Japan.
Because May is still in progress, we cannot say with certainty, but wesee signs, albeit faint, of a recovery, so we anticipate a bottoming out
in April and May.
Next slide, please.

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Many General Hospital Company products relate to healthcare
infrastructure and hospitalization. Also, many of the products andtechnologies of the DM and Alliance businesses are used in treating
chronic illnesses, so we expect impact on them to be comparatively
small.
In the Blood and Cell Technologies Company, there is some decreasein demand for blood collection due to factors including postponementof surgeries; however, the scale of impact on automated component
collection, which collects targeted blood component more efficiently, issmall. In cell therapy, we need to monitor for potential slowdown indevelopment activities by pharmaceutical companies and research
institutions, but we do not see major fluctuations in therapeutic
apheresis, because it is mostly used to treat chronic cases.
This is also not in the slides, but April revenue of the General Hospitaland Blood and Cell Technologies companies did not see significant
negative impact; they were in line with normal years.

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There is impact on April revenue of the group as a whole, with apercentage year-on-year decrease in revenue in the mid-teens. I want
to reemphasize that we do see signs of recovery for Cardiac andVascular in May, and we will continue to carefully monitor for recovery
momentum.
Next slide, please.

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Here are the new products for this fiscal year. I will skip over thedetails of these.
Next slide, please.

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Next, I will speak briefly on situation of liquidity and cash allocation.
First, regarding liquidity: We moved swiftly to secure 40 billion yen
during the previous fiscal year, and currently have sufficient cash onhand. For further preservation purposes, we have concluded additional
commitment-line contracts for 60 billion yen.
Next, regarding cash allocation: With a healthy financial situation
despite the COVID-19 situation, we continue to make mid- to longterm investments. We will also continue to pursue M&A opportunities
which will contribute to sustainable and profitable growth. However,
we will also reconsider expenses and investments which we deem nonurgent.
Finally, regarding our FY2020 dividend: Because the COVID-19 impact
cannot yet be determined with certainty, we will keep the annual
dividend at 28 yen, which is same as FY2019, for the time being. After
recovery from the COVID-19 situation, we anticipate restarting ourpolicy of increasing dividends.

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Thank you for your attention.

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