I will give an overview of the results for the period ending March 2014.

First, the results highlights.
A weaker yen led to increased sales and profit, but unfortunately, we missed ourguidance significantly. We began securing a foothold toward improving our profitability.
Those are the main highlights for the entire organization.
Now for company highlights. In Cardiac & Vascular, the American TCVS quality system
improvement efforts are ongoing. We had hoped to be released from restrictions on
selling to new customers, but unfortunately this was not achieved during the period; thisaffected FY2013 profits and will affect FY2014 negatively as well. The growth strategy wepreviously announced for intervention systems and neurovascular intervention products
is proceeding as planned, with double‐digit overseas growth in intervention systems andcontinuing new product launches in neurovascular intervention. We are leveraging
strategic alliances to accelerate products pipeline expansion.
Next, in General Hospital, delays in new product expansion and decreased productivity
at overseas plants resulted in negative impact. The new product that will be expanded in
the market has a high‐margin; we therefore feel that it is well‐poised to produce profits
going forward if it recovers as planned.
Next, in Blood Management, we feel that we have been able to sustain solid
performance despite the challenging situation of patient blood management initiatives,
as compared with competitors.

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I’ll now speak in more detail about the results. Net sales increased 16% to 467.4 billion
yen. However, 49.8 billion yen of this number is due to the weaker yen, and as a result
the actual growth was 4%.
Operating income increased 23% to 65.3 billion yen, but again, 12.8 billion yen of thiswas due to the weaker yen, and the actual growth was minus 1%. Therefore our results
excluding foreign exchange were an increase in sales and a decrease in profit.
Average exchange rates for the period were 100 yen to the dollar and 134 yen to theeuro.
As you can see on the slide, we posted an extraordinary loss of 10.9 billion yen for theperiod, which I will explain on the next slide, but due to all of the above factors, our net
income was 34.1 billion yen, or a 27% decrease from the previous period.

3Regarding the extraordinary income and loss, we had a primary extraordinary income of
6 billion yen resulting from the settlement that we explained in the third quarter.
The primary extraordinary loss was the result of impaired assets in unprofitablebusinesses: 7.6 billion yen in Cardiac & Vascular and 3.5 billion yen in General Hospital.
Of the 7.6 billion yen in Cardiac & Vascular, 7 billion yen was the impairment of a fixed
asset in that business. In General Hospital it was the impairment of transfusion solution‐
related facilities; this will lead to further improvement of profitability.

4Our operating income went from 53.2 billion yen to 65.3 billion yen. I will explain thecontributing factors using this waterfall graph.
First, we had 12.8 billion yen in foreign exchange effect. There was also our 10.9 billion
yen gross profit increment by sales increase, which was unfortunately absorbed byincreased expenses, price erosion, the US device tax, and other factors for a slightdecrease in profit.

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I will now explain results by company. Starting with this announcement, I will be adding
to the overall results an explanation by company of sales and profit.
First, company‐based sales. The figures in black are at actual foreign exchange rates: 6%for General Hospital; 24% for Cardiac & Vascular; and 24% for Blood Management. The
Cardiac & Vascular and Blood Management companies display higher profitability as
they have a higher rate of overseas penetration.
When foreign exchange effects are excluded, General Hospital is 2%; here we see theeffects of cutting low‐margin businesses in Europe and the United States. Cardiac &Vascular is 7%, and in the high‐growth intervention systems field we have maintained
double‐digit growth. In Blood Management, we have achieved growth in Japan, China,
and other parts of Asia to achieve 5% growth while competitors have struggled.

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Next is operating income by company; here we show each company’s operating income
excluding goodwill amortization, etc.
The slide shows, from left, the results for FY2012, then FY2013, then year‐over‐year
percentage change, followed by the percentage when foreign exchange is excluded.
Without foreign exchange, General Hospital was minus 16%; Cardiac & Vascular was plus
14%; Blood Management was plus 4%; and overall, minus 1%.

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I’d now like to explain for each company.
For General Hospital, we had a 2% increase in sales, as shown on the right. Operating
profit declined 16%, so we had a slight increase in sales and decrease in profit. Factors
leading to this decrease in profit were delays in the expansion of new product and lossof productivity overseas, for a decline of 1.6 billion in profit.
We also saw a 1 billion yen decrease in profit due to a change in product mix of infusion
solutions in pharmaceutical and nutrition. Along with perennially falling prices, thesewere the factors leading to the 16% decline in profit. We had hopes for the new, high‐margin product to drive profitability, but due to trouble with expansion it became anegative factor in these results. However, we do believe it will be an important profit
driver going forward.

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Next is the Cardiac & Vascular company.
Sales increased 7% and operating income increased 14%.
We did have negative factors such as the TCVS quality system improvement work, but
we were able to absorb them and achieve positive results. Interventional systems
accounted for 3.2 billion yen in growth, with access devices driving double‐digit overseas
sales and the peripheral stent Misago driving domestic growth. Neurovascularintervention saw continued development and release of new products, which
contributed to high global growth with 500 million yen. We will be pursuing lower costthrough further transferring production to the Vietnam factory. We will also beexpanding the product pipeline through strategic alliances including those with ART,Kaneka, and FMD.

9Next, in Blood Management, we were able to expand business amid a difficult market
environment to achieve 5% sales growth and 4% profit growth. Despite difficulties suchas the patient blood management program and falling prices, we expanded business ofhigh‐value‐added products such as the automated blood component processing system
Europe and the therapeutic apheresis system in the United States.
Also, we achieved double‐digit growth in Asia and Latin America.
We can expect further business growth, so we are preparing to increase production
capacity in India and making good progress in establishing the new Vietnam factory,
which will improve our profitability.

10Next is our operating profit. Our forecast for FY2013 was 70 billion yen, andunfortunately we were unable to meet it, with the actual result at 65.3 billion yen.
I’ll now explain the factors behind this result.
In General Hospital, less sales than predicted in Japan and the delay in new productexpansion together accounted for 3.5 billion yen of the shortfall.
In Cardiac & Vascular, the TCVS quality system improvement‐related costs were 3 billion
yen. Neurovascular and Intervention Systems sales increased, and we achieved SG&A
controls, but these gains could not fully offset the negative factors.
In the end, our results missed the forecast by 4.7 billion yen.

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Next is cash flow. On top of our cash balance of 78.2 billion yen at the end of FY2012,
our income before tax, depreciation and amortization, and impairment loss brought ouroperating cash flow up by 96.3 billion yen. CAPEX, debt repayment, and dividends thenbrought this down by 78.9 billion yen. The cash balance at the end of FY2013 was 95.6
billion yen. This was a cash increase of 17 billion yen, but an upcoming corporate tax
payment will cancel this increase out, resulting in approximately the same balance as
the beginning of the year.

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Next is the FY2014 forecast, which assumes average exchange rates of 100 yen to the US
dollar and 140 yen to the euro.
We project 488 billion yen in sales, 64 billion yen in operating income, 62 billion yen inordinary income, and 37.5 billion yen in net income. Year‐over‐year, we forecast a 4%
increase in sales, and, unfortunately, a 2% decrease in operating income.
I’ll now explain the factors behind this decrease in operating income.

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Here are the factors behind the forecast of 64 billion yen from 65.3 billion yen in FY2013.
We anticipate a weaker yen, which will result a 1.8 billion‐yen increase. We also project15.4 billion yen gross profit increment by sales increase, in addition to increased
productivity and lower costs, which will improve after last year’s decline.
We project a 11.5‐billion‐yen increase in SG&A and a 1.1 billion yen increase in R&D. We
will also have a Japan reimbursement price cut, which occurs every two years, which willaffect operating income by 6.2 billion yen; 4.6 billion yen of this in Cardiac & Vascularand 1.6 billion yen in General Hospital.
These are the factors behind our projected increase in sales and decrease in operating
income. But as previously mentioned, we plan to secure our footing and solve the issues
we identified in FY2013 to produce solid results in FY2014, which will position us tomake great strides going forward.

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