Q&A at IR Briefing for Financial Results for theFiscal Year Ended March 31, 2018
May 8, 2018
NEC Networks & System Integration Corporation
Date and Time: Tuesday, May 8, 2018 from 10:30-11:15*The current fiscal year: the fiscal year ending March 31, 2019
The previous fiscal year: the fiscal year ended March 31, 2018

QuestionerＡ
Ｑ：You predict a substantial rise in order receipts in your carrier networks
business forecasts for the fiscal year ending March 31, 2019. There
are other telecommunications engineering companies constructing
mobile communications base stations that have been performingstrongly. Why do you think order receipts at NESIC will expand
substantially, as projected in your forecasts? In which area do you
expect orders to expand – mobile communications base stations orcore networks?
Ａ：We achieved good results, including profitability improvement, in thelast few years by reducing our business systems fortelecommunications carriers in stages, including a resource shift tothe area of social infrastructures business, in response to their capital
investment controls. However, a number of problems, such as theinability to sufficiently meet demand for building mobilecommunications base stations, arose in the fiscal year ended March
31, 2018 as demand recovered more quickly than we had anticipated.
We are thinking about increasing our order receipts this fiscal year byrebuilding our business systems and dealing effectively with therecovery in capital investment centered on mobile communications
base stations.
Additionally, our forecasts for the current fiscal year reflected ourprediction that we would receive large maintenance orders for one fullyear, even though orders received declined due to the absence oflarge maintenance orders as we had received orders for two years at
once in the year before (the fiscal year ended March 31, 2017).
Finally, we assumed factors outside our telecommunications carrierbusiness, such as the effects the rescheduling of tenders for hotels
and others to this fiscal year are likely to have on our results.
Ｑ ： You explained that income would increase just slightly due toinvestment for growth despite of expected improvement by absenceof losses and sales growth. In which specific area will you invest ingrowth this fiscal year?
Ａ ： As investment for growth, we are thinking about allocating
approximately 2 billion yen to areas centered on R&D for developing
digital transformation (DX) and other new services, various expenses
associated with their development, including the cost of retraining
engineers, and informatization.
Ｑ：Which will be your areas of focus when you think about your mediumand long-term growth?
Ａ：We started discussing our next medium-term management plan justrecently. We are thinking about discussing ways to develop ouroperations in areas related to state-of-the-art technologies such as
DX in order to supply “No.1” or “Only 1” services. We believe we candevelop services of higher levels in the future because we are
currently assembling in-house technologies and business knowhow
through a cross-segment project. We think DX technologies will start
showing their effects in the area of work style innovaton before
anywhere else. We began verifying this in our offices that had beenrenewed with the introduction of these technologies and approaches.
We believe we will become able to apply these state-of-the-art
technologies to areas such as social infrastructures and local
government in the future.
Moreover, we are planning to advance our overseas business in which
projects have started to be activated this fiscal year, reversing thedifficult situation in the previous fiscal year, which was a project
off-year.

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